BAD NEWS FOR OIL PRODUCERS
Those who have exposure to North Sea oil and gas producers in their investment portfolios will be hit by one of the many new taxes introduced in yesterday’s budget. Dubbed the “fair fuel stabiliser”, it increased the taxes being levied on these companies from 20 per cent to 32 per cent.
This increase, applicable from midnight last night, will kick in whenever the oil price is over $75 a barrel.
To give an example of the short term effects of the Chancellor of the Exchequer’s announcement, Nautical Petroleum’s share price dropped by 8 per cent yesterday afternoon. Time will tell if the tax causes long term harm.
JUNIOR ISAS INTRODUCED
The government outlined plans in the budget to introduce ISAs for the under 18s in order to fill the void created by the abolition of child trust funds (CTF).
The Junior ISA will be avaialbble to all children under the age of 18 who do not have a CTF.
Though the size of the allowance has not been announced, predictions are that it will be around the £3,600 mark, with the product being similar to standard ISAs and offer cash account and stocks and shares versions.
Draft legislation, set to be published on 31 March alongside the Finance Bill 2011, will set out proposed account features.
GREEN BANK CREATED
According to the Chancellor, the creation of a “green investment bank” will encourage investment in new energy businesses where returns are deemed not viable by the market. £1bn has already been committed to the project, but a further £2bn will be allocated in order to prop up the green industry in Britain.
George Osborne announced that the measures will enable the Green Investment Bank to start operation one year earlier than planned – in 2012. On top of the funds from taxpayers, the government will leverage a further £15bn from private sector investment in green projects.