How has the budget affected you?

The announcement of this week’s emergency budget has

understandably been met with a mixed reaction. While people appreciate that

something needs to be done to address the muilt-billion pound deficit they may

find it hard to stomach some of the decisions made by the Coalition Government.

It was never going to be easy for the incoming government to

balance the books but has Conservative Chancellor George Osborne (with the

approval of Lib Dem Vince Cable, apparently) made the right decisions?

The main changes are as follows:

·        

VAT is set to rise from 17.5 per cent to 20

percent

·        

Public sector workers will have their pay frozen

for two years

·        

Significant cuts to the child tax credits system

·        

Capital Gains Tax increased from 18 per cent to

28 per cent

·        

Child benefit frozen for the next three years

·        

Housing benefit cut after 12 months on Job

Seekers Allowance

 

·        

Cuts in corporation tax and small business tax

·        

Operational allowance doubled for Army service

personnel in Afghanistan

·        

No increase in duty on cigarettes, alcohol and

fuel

·        

Personal income tax allowance raised to £7,475

(from £6,475)

·        

Council tax frozen

And what does this mean for people in Redland?

Redland’s population can be divided into three main

demographics; families with young children, retired people and students.

According to acting Labour Leader Harriet Harman, this emergency

budget is set to hit the latter two really hard. Speaking in the House of

Commons she said that families on less than £40,000 would lose tax credits and

pensioners would gain ‘nothing’ from the budget.

Personally, I’m not too phased by the budget – as a low paid

worker with no assets who doesn’t spend much money on things other than cider I

should be OK. The rise in the income tax allowance means I’ll only pay tax on a

few grand of my earnings, the VAT rise doesn’t apply to food so shouldn’t hit

me too hard and there’s no rise in alcohol duty so my beloved cider should

remain the same sort of price. Finally, I don’t own a house or anything of

value so capital gains tax is irrelevant for me.

However, I realise this isn’t the same for everyone. What

about all of the public sector workers (that’s councils, civil service,

hospitals, schools etc) who live in Redland, they can forget about pay rises

for the next few years? But then, us private sector workers (especially in the

media industry) have had to endure pay freezes for the past two years while

paying for rises in public sector wages through our taxes so this actually

seems a bit fairer.

It’s not all doom and gloom of course, small businesses

(especially those outside of London) will enjoy tax relief and members of the

armed forces will receive an extra reward for serving in Afghanistan...of

course the biggest reward would be to pull them out altogether!

So, is the budget good news for you? Or can you suggest any

better ways of doing it? Has it given you new faith in the coalition government

or simply pushed you further into the Labour camp?