Chancellor of the Exchequer George Osborne yesterday cancelled next month’s intended £0.04 fuel duty hike, in what he described as his “Budget for growth” – and a further £0.01 will be slashed from petrol prices straight away. The move will be funded by a £2 billion tax on oil firms.
The chancellor told Parliament that “the cost of filling up a family car such as a Ford Focus has increased by £10” and indicated that he intended the fuel duty cut to ease the burden on families
feeling financial pressure.
Labour responded by pointing out that the government’s VAT increase in January had already added £0.03 to the cost of a litre of petrol.
The Budget also set out a number of measures aimed at promoting private enterprise, including a 2
per cent cut in corporation tax to take effect from April.
Osborne was forced to acknowledge that previous economic growth forecasts had been revised
down from 2.1 per cent to 1.7 per cent, which prompted ridicule from Labour party leader Ed
Miliband, who said: “Every time he comes to this House growth is downgraded.”
Tax on alcohol increased by the amounts already announced by the previous Labour government –
adding £0.54 to spirits, £0.15 to a bottle of wine and £0.04 to a pint of beer. The price of cigarettes
was also hiked by up to £0.50 on a packet of 20.
In a change to personal tax thresholds, April 2012 will see the amount people can earn before having
to pay tax increase by £600.
The Budget also saw a £250 million pledge to help first-time buyers purchase new houses and flats
in England – though the new FirstBuy Direct scheme bears striking similarities to Labour’s HomeBuy
Direct service, which ended last year.
Ed Miliband criticised Osborne’s ‘Budget for growth’, claiming the coalition government’s public
spending cuts were damaging the country’s recovery.
He said: “One fact says it all and he couldn’t bring himself to say it: Growth down last year, this year
and next year. It’s the same old Tories – it’s hurting but it isn’t working.”
