Newspaper article The Evening Standard (London, England)

What the Budget Will Mean to You; Never Mind All the Fiscal Mumbo Jumbo, How Will the Chancellor's Changes Affect Your Situation?

Newspaper article The Evening Standard (London, England)

What the Budget Will Mean to You; Never Mind All the Fiscal Mumbo Jumbo, How Will the Chancellor's Changes Affect Your Situation?

Article excerpt

Byline: ANDREW OXLADE

GORDON Brown is expected to tread carefully in the Budget tomorrow.

The fragile British economy gives the Chancellor little room to force further direct taxes on an electorate already wincing from a one per cent hike in National Insurance (NI). The rise was announced last year but kicks in this month.

Workers without children - and who are therefore unlikely to benefit from new family tax credits - will bear the brunt. Someone on u30,000 a year will be around u250 worse off. A high earner on u60,000 will be almost u600 out of pocket.

So with the Chancellor worried about heaping further misery on Middle England this time around, who will be in the firing line?

PARTY PEOPLE

A crackdown on cross-Channel smuggling makes a hike in tobacco prices more likely, according to accountancy firm Baker Tilly. It expects an inflation-busting 8p to 13p rise on a packet of 20 cigarettes, taking the average price to u4.50.

Last year it was a 6p rise.

A five-year freeze on spirits duty and a two-year hold on beer and wine could also end. These generous measures were a bid to beat "booze cruisers", according to Baker Tilly.

"With the anti-smuggling measures now performing to expectations, the Chancellor may spring a surprise and increase duty on alcoholic products," a spokesman said.

Spread-better Cantor Index expects an extra 5p-8p on a bottle of spirits, 2p on a pint of beer and 3p-6p on a bottle of wine.

House-buyers and homeowners

Accountant firm PKF is among the biggest doom-mongers on stamp duty. At the moment, buyers pay one per cent on property up to u250,000, then three per cent up to u500,000 and four per cent above that. PKF expects a whopping rise on the top band to seven per cent, broadly to match European property tax.

Other pundits suggest that a new rate of five or six per cent for homes worth more than u1 million is more likely.

Homeowners also want the stamp duty thresholds to rise in line with a 40 per cent surge in house prices in the past two years. …

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