THERE has been a mixed response to the Government’s budget from Northumberland’s MPs.
Chancellor George Osborne last week reduced the top rate of tax, affecting those earning over £150,000, from 50p to 45p in April 2013, and introduced a new seven percent stamp duty rate for properties worth more than £2million and a 15 percent rate for £2million plus homes bought through companies.
He is also going to raise the threshold at which people start paying tax to £9,205 in 12 months time, but age-related tax allowances will be frozen and axed.
Other measures included a fall in corporation tax from 26 percent to 24 percent, which will take effect next week, and a rise of 3p a litre in fuel duty from August.
Labour MP Ian Lavery, representing Wansbeck, said: “As the impact of this coalition Government’s budget becomes clear, the Chancellor will have great difficulty justifying the choices he has made.
“This is a budget where millions are asked to pay more so millionaires have to pay less. A total of 14,000 people earning £1million or more are getting a tax cut of over £40,000 each year, while at the other end of the scale, a family with children earning just £20,000 a year loses £253 a year from this April.
“Meanwhile, David Cameron’s £3.3 million Granny Tax will see 4.4million pensioners lose an average of £83 a year, with people turning 65 next year losing up to £323.”
Berwick Liberal Democrat MP Sir Alan Beith, said he was delighted that the Chancellor had listened to his Party’s calls for the income tax threshold to be raised further.
“I want to see a fairer tax system where help is provided for those who need it most and where the richest pay their fair share,” he said.
“Raising the income tax threshold to £9,205 will help ordinary working people in Northumberland who have been struggling with bills and the higher cost of living.”
Conservative Guy Opperman, MP for Hexham, said: “The biggest move in this budget is a tax cut for normal families. People on the minimum wage working full time will have seen their income tax bill cut in half.
“To take 840,000 people out of paying income tax altogether shows this Government is focusing the help on those at the bottom to always make sure work pays.
“I was pleased to see the Chancellor adopt the stamp duty increase on mansions which I called for last week. The new 15 percent tax on companies buying property over £2million and closing loopholes will mean the richest will be paying the biggest burden.
“And a cut in corporation tax will help boost Northumberland’s economy, as will the Chancellor’s commitment to get more money from the banks to loan more to British businesses.”