While it’s important to keep up-to-date with how the Government is planning to deal with the national deficit in the US, it’s also interesting to look into how other countries – with economies closely linked to the US economy – are planning to raise money to cover their spending.
In this guide, we’re going to focus specifically on the UK – and how their recent ‘Budget’ announcement will affect the country’s residents.
Chancellor of the Exchequer in the UK, George Osborne, has announced his 2011 Budget – which is a statement made annually by the Government on (among other things) how it is going to raise the money it needs to spend on the country.
The question is, though, who is likely to benefit from this year’s Budget, and who is likely to lose out?
This year’s Budget will have a positive effect on several key groups – like workers, first-time buyers and drivers.
Those who work and pay income tax will be around £0.90p better off a week after an allowance increase was announced.
And Mr. Osborne said that rather than going ahead with the planned rise in fuel duty, he would actually cut the rate by £0.01p per litre. Although fuel prices remain high in the UK, motorists filling up will still save a bit of money as a result.
At least 10,000 first-time buyers will receive help in the form of an ‘equity loan’ from the Government and house builders. The ‘First Buy’ scheme is designed to help first-time buyers afford a deposit for a newly built property.
They will be required to stump up 5% of the property’s value, while the UK Government along with homebuilders will contribute 10% each… which could allow the homebuyer to qualify for a 75% loan-to-value mortgage.
As the saying goes: where there are winners… there are losers.
The main groups who will lose out following this year’s Budget include the unemployed, families and some of those on housing benefit.
People without jobs are set to face cuts to the benefits they receive. Not only this, but disabled people and renters of high-cost housing will also lose out – with some claimants facing losses of £80 (or greater) a week.
Families earning more than £40,000 a year will see their child tax credits removed (the threshold comes down from £50,000). Child benefit will also be frozen for the next three years.
People who receive housing benefit will see the amount they can receive limited. For example, for a four-bedroom or larger house, benefits will be limited to a maximum of £400 per week.
Useful money resources: