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Chancellor slashes stamp duty for first-time buyers

ALISTAIR Darling has said stamp duty will be scrapped on house purchases up to £250,000 for first-time buyers – to be funded by a five per cent levy on those buying homes over £1m.

The chancellor unveiled the measures in his budget in which he said the economy was at a “crossroads”.

Meanwhile he said that public borrowing was £11bn below forecasts at £167bn.

Darling said he revised downwards slightly the growth forecast for 2011 to between three per cent and 3.5 per cent to bring it more in line with predictions from the City.

Growth is predicted at 1 to 1.5 per cent for 2010.

And £2.5bn of support for small business to boost skills and innovation will be pumped into the system to help fuel the economy.

Other measures include the making available of bank accounts to a further million people.

The chancellor also revealed that the tax slapped on City bonuses had raised £2bn – twice the amount forecast.

In a help to small businesses he said RBS and Lloyds had agreed to come up with £94bn in new loans.

A 3p fuel duty rise to be phased in between April and January 2011, while wine, beer and spirit duty will be hiked by two per cent a year until 2013. Duty on cider to rise by ten per cent above inflation.

Tobacco duty will jump by one per cent this year and two per cent a year afterwards.

Darling also said he planned to set up a "green" investment bank investment controlling £2bn of equity which will focus cleaner energy and transport, with a special emphasis on wind turbines.