Budget 2009

matbe

Im not saying they will put it up, but it was frozen at 15% until at least December, when they announced the reduction last year.

Also once they announce that it is to rise again expect a mini boom as people who have money rush to make large purchases 2.5% isnt much on a tenner but a 40 grand extension to your house is a different matter.

Masomnia

Thing is, they'll want to be seen to be doing something for savers, and whilst interest rates are so low and the take from tax on interest is low too raising the ISA limit won't cost them so much.

matbe

Masomnia wrote: »

Thing is, they'll want to be seen to be doing something for savers, and whilst interest rates are so low and the take from tax on interest is low too raising the ISA limit won't cost them so much.

Yes thats a good point i hadn't thought of.

Mr_Mumble

The scrapping of higher rate tax relief for pensions is the only curveball that would bring in a lot more tax and could be politically palatable.

Masomnia wrote: »

Pretty much agree with the above, I'd also expect the annual ISA allowance to be increased to £10,000.

The reason for the change to £3,600/£7,200 was partly due to the figures being easily divisible by 12 (for monthly regular saving). I can see a raise as a sop to savers (its hardly going to be too costly with current rates) but can't see a huge leap in the cash ISA since this could get expensive for the treasury when rates rise again.

VAT at 20% sometime in 2010, frozen for now.

Hopefully not as it would stop a growth in consumption when its needed most and we must already be close to the Laffer optimum. Germany's increase in VAT has been a disaster and it could be argued that a reason for current global imbalances is because Germany doesn't consume enough.

baileysbattlebus

Mr_Mumble wrote: »

The scrapping of higher rate tax relief for pensions is the only curveball that would bring in a lot more tax and could be politically palatable.


The reason for the change to £3,600/£7,200 was partly due to the figures being easily divisible by 12 (for monthly regular saving). I can see a raise as a sop to savers (its hardly going to be too costly with current rates) but can't see a huge leap in the cash ISA since this could get expensive for the treasury when rates rise again.


Hopefully not as it would stop a growth in consumption when its needed most and we must already be close to the Laffer optimum. Germany's increase in VAT has been a disaster and it could be argued that a reason for current global imbalances is because Germany doesn't consume enough.

I have to agree about the vat - consumption in Germany has been falling since the introduction of the "barely noticeable" 3% increase. I can't really see vat here rising above 17.5% here any time soon.

whathavewedone

There are murmerings about JSA being increased

kwikbreaks

Masomnia wrote: »

Thing is, they'll want to be seen to be doing something for savers, and whilst interest rates are so low and the take from tax on interest is low too raising the ISA limit won't cost them so much.

The way the banks operate it will be very cheap for anybody not watching the rates. I have to open a fresh ISA every year and move the money because the "old" ISA rate drops to something ludicrous. Often the new ISA is with the same bank but this year I'll be moving my whole ISA pot to a different one (NatWest as it happens who insist I open yet another account with them which will sit there a year with £1 in before being closed. Lunacy). Bankers are all con artists.

Jonbvn

Masomnia wrote: »

Pretty much agree with the above, I'd also expect the annual ISA allowance to be increased to £10,000.

Any rise in ISA allowances will be small and likely divisible by 12, similar to the previous rise. Maybe £7,800 or max of £8,400 limit.

However, Mr Darling said Wednesday's Budget would contain a series of key announcements that he is probably just going to make-up in the car on the way to work.;)

Old_Slaphead

1984ReturnsForReal wrote: »

Putting Vat up at december is bad politics. Gas, Elec & Chrissy Prezzies mate..

They said VAT would be going back up in Jan 2010.

IMO prob to 18.5%

inspector_monkfish

FROM REUTERS....

10:10 22Apr09 Official GDP forecasts to be slashed in UK Budget

09:10 GMT - Central to today's [UK BUDGET] will be the expected and dramatic revision to Govt [GROWTH F/CS] with Chanc Darling predicted to opt for something close to a 3.5% contraction this year vs his central target of -1.0% in the Nov pre-budget. Note that the OECD is forecasting a 3.7% drop in UK output this year, the IMF -3.8% and the CBI -3.9%. Any of these estimates would mark the largest annual contraction since 1945.

Crucial for the path of public finances will also be the speed of the recovery with Darling expected to veer towards calling a v-shaped recession. He is likely to say the economy will start to pick up by year end and that official figs will show positive growth in Q1. In Nov he predicted a 1.5-2.0% growth rate for 2010 and 3% in the following 3 years.

Market consensus for next year is for a small 0-0.5% rise in GDP.