In today’s Budget, you may begin to detect just a hint of Osborne’s future leadership campaign. You might note a few more smiles, a bit more swagger, even smoother hair – and definitely a few popular measures thrown in, such as, maybe, 2p instead of 1p off a pint. See how much he loves the people?
When it comes to our money, we know he has backtracked on huge changes to pensions that would have seen tax relief massively reduced. Some changes are still expected, but not as drastic. So that’s like less bad, bad news.
Osborne might raise fuel duty just a little bit in light of the big fall in the cost of petrol in the last 12 months – because that’s an absolute sitter – and it is likely that he will further increase Insurance Premium Tax, raising the cost of essential car and home cover as the cost of the higher insurance tax is passed on to customers. Buy to let investors have already received enough bad news in the last 12 months to make them re-think their entire business models.
So far, so grabby.
Anything good for our money going to come out of today?
The idea of turning the UK from a culture of credit into a culture of savers might just be backed by a little substance. There is the introduction of the individual savings allowance, which means no tax on savings interest up to £1,000; the inclusion of peer-to-peer lending in ISA wrappers through the new Innovative Finance ISAs. And the possible introduction of a £600 savings booster, or “help to save” as it might be entitled. All of this screams: “stop spending all of your money. Haven’t you seen what we are doing to pensions? Get saving or you will end up homeless in retirement.”
What about encouraging people to put their money somewhere more socially responsible? There is likely to be further announcements to widen the availability of IFISAs and Social Investment Tax Relief (SITR). SITR is yet to take off in a big way with retail investors, but as a private sector solution to a decline in government funding, is something the Government, not surprisingly, would like to succeed. However renewable energy investors, after seeing incentives slashed since last May, are unlikely to receive any further love from the Chancellor.