What i'm expecting from The Budget on Wednesday

With the UK struggling to grow chancellor George Osbourne will be under pressure when he announces this years budget on Wednesday. 
I will be outside The Bank of England on the day as George Osbourne announces the changes he is willing to make to our economy. 
As Economic and Business Reporter for WINOL this day will be the most important for me. 
From reading around and researching here's what I might expect to hear.
The deficit 
The deficit is the amount that the government has to borrow every year to cover the gap between the amount it spends and the amount it receives in tax.
From 2009-10 to 2011-12, borrowings have ben cut by nearly 25%.
But borrowing is still considerably higher than before the start of the recession in 2008.
On Budget day we will know the new amounts as to how much the government has borrowed in 2012-13 and how much it expects to borrow in futher years to come. 
It looks like the deficit will last longer now until 2017-18 rather than the expected time that it would end in 2014-15. 

The Bank of England
There may be change for the Bank of England's remit so it can help drive an economic recovery. (This may involve giving it more leeway over the 2% inflation target or adding a growth target.) 
The Bank of England's Funding for Lending Scheme may be adjusted or expanded which, though designed to increase lending to small businesses and individuals, but has so far failed to boost the number of loans being offered by banks.

Alcohol & Fuel 
I think a lot of people will be interested in this one. Alcohol taxes will automatically rise by 2% above inflation in April but a bigger increase may come. 
This is not necessarily bad. It could help pay for a potential suspension of a fuel increase planned for the autumn. Therefore motorists will be happy. 

Increase personal tax allowance, the amount that you can earn before you have to pay tax?- to £10,000 ( Liberal Democrats have lobbied the chancellor for this) 
Cut to corporation (large companies) tax rate to 20%. .
All those tax cuts should help stimulate growth. 
Austerity has been used to reduce public expenditure but England cannot get public spending to fall. 
Unfortunately there are no simple ways to create growth. Governments simply spending more money won’t solve it. Perhaps tax cuts would help. 

No comments:

Post a Comment