WHO: GEORGE OSBORNE
WHEN: 12.30PM TODAY
WHERE: HOUSE OF COMMONS
WHAT WE ALREADY KNOW
Extended Sunday shop hours
The chancellor will unveil plans to devolve powers to mayors or councils to decide for themselves what the rule over trading hours should be in their areas, paving the way for shops and supermarkets to stay open later on Sundays.
A cut in the inheritance tax
Osborne is set to increase the inheritance tax threshold from £650,000 to £1m for couples from 2017, a plan first laid out in the Conservative manifesto. The policy will be paid for by limiting the amount of tax relief on pension contributions given to those earning more than £150,000 a year.
Higher rents for council homes
More than 300,000 council tenants will be told today that they will need to start paying full market rent if they earn more than £40,000 per year in London and above £30,000 in the rest of the country.
Slashes to the BBC’s subsidies
The chancellor will force the BBC to meet the cost of providing free TV licences for pensioners over the age of 75, a cost currently borne by the government. The move will reportedly cost the BBC – and save the Treasury – £650m.
A lower cap on benefits
The benefits cap, the total amount a family can claim in welfare benefits each year, will be cut to £23,000 in London, and even lower – reportedly £20,000 per household – outside of London.
WHAT MIGHT HAPPEN
Bringing down the bank levy
Given concerns about HSBC and other banks moving business overseas, it has been widely speculated that the chancellor may use the Budget to drop the extra tax rate on banks.
A lift in the personal allowance
On the campaign trail, the Conservatives promised to raise the tax-free personal allowance to £12,500 by 2020. Osborne may make good on the promise today in his Budget presentation.
An axe to the 45p rate
Vocal Tory backbenchers – including mayor of London Boris Johnson – have called for the chancellor to bring down the top rate of tax from 45p to 40p. While Osborne said over the weekend that his income tax “priority” would be lifting the personal allowance, it remains to be seen whether the higher rate will get the axe.
Business rates reform
Given that a formal review of business rates started under the last government has now closed, some analysts expect Osborne to announce changes to the way in which the government raises revenue from business properties.
A boost to minimum wages
Amid increasing political pressure to implement a so-called Living Wage, the chancellor may use the Budget to recommend a raise in the national minimum wage. While the move would likely prove unpopular with businesses, Prime Minister David Cameron said last month that he wanted to move toward a “high wage, low tax, low welfare” society.
Cracking down on non-doms
Before the General Election, the Tories said that they would collect £5bn by cracking down on tax evasion, leading some to speculate they may reform tax benefits for so-called non-doms.
Morgan Stanley expects Osborne to unveil a “heavily front-loaded deficit reduction plan” in the Budget as well as a substantial programme of asset sales, exceeding what was assumed in previous OBR forecasts, translating into an £11bn reduction in gilt sales.
PwC is looking for a big focus on decentralisation and regional investment, and boosting productivity by supporting innovation, skills and technology, in the chancellor’s announcement today.
GET READY FOR GEORGE
All you need to know about the Budget before the chancellor stands up. The Forum, pages 20-21