United Kingdom: Burnham’s budget doubles the additional tax on bank profits to 6 per cent
The British Government intends to reduce debt and increase investment in defence and industry
LONDON – You could call it the ‘budget of small things and big ambitions’: the first Budget of the Labour Government led by Andy Burnham, presented today in Parliament, has proposed a series of small-scale measures to ease the cost of living in the short term and has outlined major projects for the future.
"The Government’s mission," said the Chancellor of the Exchequer John Healey, is “to give people some breathing space” after years of rising inflation, given that, according to the polls, the cost of living is people’s main concern.
“Twenty years ago, British citizens bailed out the big banks; now it is the banks’ turn to help ordinary people in a time of crisis,” said the Chancellor, announcing that the additional tax on bank profits would rise from 3 per cent to 6 per cent for a limited period of 15 months.
The funds raised will be used to finance the measures announced: every household, except the wealthiest, will receive £100, which will be paid directly into their bank account to help with the cost of utility bills this winter. The move will cost £2.6 billion. Also on the energy front, fixed charges on gas bills and VAT on electricity bills will be abolished. Looking ahead, Healey has promised a radical reform of the system that will reduce energy costs in the long term.
“This is a budget for workers and for businesses, both small and large, based on fiscal discipline and setting a clear course for the future,” said the Chancellor. The minimum wage will be increased by 3.9 per cent, above the rate of inflation, to help those on the lowest incomes, whilst local business rates will be reduced and, in some cases, abolished altogether. Taxes on betting, on the other hand, will rise to 25 per cent.
