At a glance: All of Alistair Darling’s 2010 Budget tax and spend policies


l Confirmed pre-Budget report (PBR) 2010 growth forecast of 1-1.5 per cent. But the chancellor revised downwards the 2011 forecast to 3-3.5 per cent to bring forecasts in line with those of the Bank of England. Growth forecast of 3.5 per cent in 2012 maintained.

l Inflation spike expected to be temporary before falling to two per cent later this year and then to fall further through the first half of 2011.

l Public borrowing for 2009-10 revised downwards by £11bn to £167bn from £178bn thanks to higher than expected tax receipts in winter months.

l Expected to fall to £163bn next year, £131bn in 2011-12, £110bn in 2012-13, £89bn in 2013-14 and £74bn in 2014-15.

l As a share of GDP, borrowing to be 11.8 per cent this year before falling every year to reach four per cent by 2014-15. The Budget will be balanced by 2016-17, a year earlier than previously forecast.

l Net debt as a share of GDP will be 54 per cent this year and peak at 74.9 per cent by 2014-15. It will then fall.

l The structural deficit is estimated to be 8.4 per cent of GDP this year and will fall to 2.5 per cent by the end of 2014-15.


l Reiterated 2.2 per cent increase in real government spending. Total managed expenditure (TME) expected to rise by over £11bn in real terms in 2010-11. The Budget also set out efficiency savings of £11bn per year until 2012-13.

l The Department of Health has said that it will make efficiency savings totalling £4.35bn a year by reducing the costs of procurement and energy usage.

l The Home Office has said it is committed to achieving savings of £350m per year by March 2013, with the majority coming from procurement.

l Forecast that public sector net investment will fall to £39bn – or 1.25 per cent of GDP – by 2013-14 compared to £50bn in 2009-10.

l Confirmed that spending on frontline schools and NHS, 16-to-19 education and Sure Start will be protected in the years to 2012-13.

l Confirmed that all public sector pay settlements will be capped at one per cent for two years from 2011, with a saving of £3.4bn a year.

l Relocation of 15,000 civil service jobs out of central London within five years.

l The Treasury forecasts that the Debt Management Office will need to issue a gross £187.3bn worth of gilts in 2010-11.


l One-off bank bonus tax has raised £2bn, double the PBR forecast.

l RBS and Lloyds Banking Group to agree to legally-binding net lending commitments of £94bn to homebuyers and businesses over the next year, of which £41bn will be lent to small businesses.

l Announces principles to guide international work on a systemic risk tax on banks balance sheets.


l Creation of UK Finance for Growth, a new national investment corporation, to oversee more than £4bn of the government’s SME finance products, including the Growth Capital Fund.

l Doubling of the Annual Investment Allowance, which will allow firms to offset £100,000 of capital expenditure in a given year against taxable profits.

l From April 2010, entrepreneurs will pay 10 per cent capital gains tax on the first £2m of gains instead of £1m.

l New 10p corporation tax on income from patents in the UK confirmed.

l A temporary increase in the level of small business rate relief from October, so that eligible small firms will pay no business rates for one year.

l A small business credit adjudicator will be created with statutory powers tom enforce its judgements.

l Up to £25m to be invested in a University Enterprise Capital Fund through UK Finance for Growth to provide early stage funding for the commercialisation of university innovations.

l 15 per cent of central government procurement spend should go to SMEs.

l Extension to the Time to Pay scheme, which has already benefited 200,000 businesses, mostly SMEs.

l Tax relief for the UK’s video games industry, subject to EC approval.


l 50 per cent tax rate on incomes above £150,000 will start in April 2010.

l The personal allowance will be gradually phased out for those with incomes above £100,000 from April 2010.

l The inheritance tax threshold will remain frozen at £325,000 until 2014-15.

l Stamp duty limit raised to £250,000 for first-time buyers for the next two years. It will be funded through a permanent hike in 2011-12 in stamp duty tax to five per cent for all homes above £1m.

l Confirmed hike in National Insurance Contributions (NICs) from April 2011.

l The 3p rise in fuel duty will be staged: 1p in April, October and January.

l Cider duty rates will rise by 10 per cent above inflation from Sunday. All other alcohol duty rates will rise as planned by two per cent and by two per cent above inflation for two further years until 2014-15.

l Tobacco duty rates up by one per cent and by two per cent above inflation for next four years.

l Anti-avoidance tax measures to raise £500m, including laws to stop firms claiming excessive relief in the UK for foreign taxes, modernising penalty and interest regimes, closing loopholes for corporate taxes.

l New tax agreements with Belize, Grenada and Dominica.


l Basic state pension to rise by 2.5 per cent to £97.65 a week for a single pensioner or £156.15 for couples.

l Restrict tax relief on pensions savings from April 2011 for people with gross incomes of over £150,000, subject to a floor of £130,000.

l The rate of relief will be tapered down from 50 to 20 per cent as gross income increases from £150,000 to £180,000. Those earning over £180,000 will receive 20 per cent relief.


l Pensioners to receive additional payment again this winter, worth £100 to households with someone over 80 or £50 with a household member over 60.

l Child tax credits for families with children aged one and two to increase by £4 per week from April 2012

l From October 2011, the highest rents across the country will be excluded from the calculation of the Local Housing Allowance. Expected to save £250m.


l £450m extension of the Young Person’s Guarantee from March 2011, which ensures that nobody under 24 finds themselves not in work, education or employment for more than six months.

l National Minimum Wage will rise by 2.2 per cent to £5.93 an hour in October.

l Confirmed guarantees of a place for every 16- and 17-year-old in education or training to be available to school-leavers again next September.

l A £270m fund to pay the teaching costs of 20,000 extra undergraduate places in key courses such as maths and sciences in September 2010.

l Kept reduction in the minimum number of hours worked for the over-65s to be eligible for Working Tax Credit.

l Support for Mortgage Interest scheme for the unemployed extended until December 2010.


l New government green investment bank to be created, which will focus on investing in sustainable transport and renewable energy.

l £60m for the development of ports to support offshore wind turbine makers.

l Climate change levy rates to be raised in line with inflation from April 2011.

l Ultra-low carbon cars to be exempted from company car tax for five years.


l Landline Duty at 50p a month.


l High-speed rail proposal confirmed.

l £100m for repair of local roads and £285m to improve motorway capacity.


l £2.5bn for operations in Afghanistan.