Budget Special: Taxation: Key Taxes Frozen to Prepare for Poll
With the General Election looming, tax rises never looked likely in this year's Budget, and with little leeway for cuts, Gordon Brown yesterday froze nearly all key taxes.
While income tax rates, capital gains tax and corporation tax were left alone, Mr Brown announced proposals to boost the tax free limit on goods brought outside the European Union from pounds 145 to pounds 1,000.
Tax breaks on ISAs were extended until 2010 and personal income tax allowance is to be raised in line with inflation.
Mr Brown said the Inland Revenue and Customs are to consult on a single tax account for small business where information is provided only once.
Diane Blinkhorn, director of Banbury-based Bibby Financial Services, said: 'The freezing of corporation and capital gains tax along with the climate change levy and company car taxation will be a welcome relief to many small firms.
'However it was disappointing that the Chancellor failed to act on the long forecast amalgamation of the Inland Revenue and Customs & Excise; again proposing further consultation rather than direct action.'
Mr Brown also pointed to the 70,000 firms that no longer have to provide forms to account for every VAT transaction they make and said he hoped more would use the scheme.
'Working with the chambers of commerce we will encourage take-up among the 600,000 companies now eligible to benefit from this VAT simplification,' Mr Brown said. …