Chancellor George Osborne has given his Autumn Statement outlining his plans and forecasts for the UK economy including changes to tax policy, cuts, and investment.

Personal Tax

  • Stamp Duty overhaul – No duty for properties worth less than £125,000, and then on sliding scale of 2% on value between £125,000 and 250,000, 5% on value between £250,000 and £925,000, 10% on value between £925,000 and £1.5 million, and 12% on value above £1.5 million
  • Income tax – Tax-free personal allowance raised to £10,600 and higher rate income tax threshold raised to £42,385
  • ISAs can be inherited tax free
  • People who die aged under 75 to be able to pass on annuities tax free
  • Fuel duty remains frozen

Corporate Tax

  • New ‘Google tax’ levied on 25% of profits multinational companies shift abroad to avoid taxation
  • Banks to pay £4 billion more in tax over next five years
  • Inflation-linked increase in business rates capped at 2% with the discount avaialble for shops, pubs and cafes increased to £1,500.

Personal savings and loans

  • New ISA limit raised to £15,240
  • Government-backed student loans of up to £10,000 to be made available for postgraduates

Devolution

  • Welsh business rates to be devolved to Welsh government
  • Plans for possibility of devolving Northern Irish corporation tax to Northern Ireland

Government cuts and efficiency savings

  • Further £10 billion of Whitehall efficiency savings planned
  • £5 billion sought from crackdown on tax evasion and avoidance
  • Public service pension reform planned to save £1.3 billion per year

Government spending and investment

  • NHS to get additional £2 billion every year for frontline services
  • £1.2 billion investment in GP services
  • £250 million investment in new advanced material science institute in Manchester with branches in Leeds, Sheffield and Liverpool

Forecasts

  • Office for Budget Responsibility (OBR) forecast for 2014 GDP growth upgraded from 2.7% to 3% and 2015 forecast raised to 2.4%
  • “Deficit is falling this year and every year” and is now cut in half. OBR forecasts borrowing to fall from £97.5 billion in 2013/14 to £91.3 billion in 2014/15. Budget surplus of £23bn predicted for 2019/20
  • “Very substantial savings in public spending” required in coming years despite government spending £10 billion less than forecast this year
  • OBR predicts wage growth above inflation for next five years
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