2010 Budget ‘not as bad as it might have been’
HOUSING benefit and a VAT hike were the big talking points today (Tuesday), as the coalition Government’s first ever Budget was unveiled.
Chancellor George Osborne announced that VAT was to rise to 20 per cent in January, and that child benefit would be frozen for three years, in emergency austerity measures Mr Osborne described as “unavoidable”.
In a bid to reduce Britain’s �155bn deficit, Mr Osborne said tax credits for families earning more than �40,000 would be cut, and a new �400-a-week maximum limit will be applied to housing benefit, saving �1.8bn a year.
Elsewhere, public sector workers earning more than �21,000 face a two-year pay freeze, but the personal income tax allowance will be raised by �1,000 – saving basic rate taxpayers �170 a year.
Responding to the budget, Hertfordshire Chamber of Commerce chief executive Tim Hutchings said that, from a business perspective, it “is not quite as bad as it could’ve been”.
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“It’s more or less in line with what we expected,” Mr Hutchings said.
“We will need to think about what the ongoing impact of the cuts in the public sector will be, and it remains to be seen what the impact [of the VAT rise] will be, particularly with it being announced so far ahead. You might expect a boom towards the end of the year, as people buy to avoid the tax.
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“I’ve got mixed views about it. It may create a mini boom rather than support stable growth.”