Call that a Budget?

As you are aware yesterday was Budget Day for the UK and probably one of the most important days of the last thirteen years for the Labour Government. Yes – it truly was a make or break day and I am sorry to say everything broke for them.

In light of the current economic situation, the vast debts Britain currently has and the prediction that by 2015 the country will be in the red to the tune of £1.4trillion, I for one, was hoping for a show of strength, for Alistair Darling to finally show us the plans the Labour Government have for steering us out of the recession and into more stability. Unfortunately what they gave us was a Budget with more potholes than our roads!

No surprise that Alistair Darling hit the usual money-grabbers such fuel, alcohol and cigarettes (luckily I don’t drive, smoke or drink Cider) as you can always depend on them to be at the forefront of any Government’s stealth tax plans but the real shocker was how badly the figures seemed to add up.

One example of this is the plans to abolish Stamp Duty for first-time buyers up to purchases of £250,000 and the respective introduction of a new 5% tax for homes sold for £1million. On the face of it this can only be good news can’t it? – surely it’s going to kick-start the property market? No – when you look a little deeper the expected figures are miles apart with the expected Stamp Duty break costing £550million by 2012 and the expected income from the “Mansion Tax” only generating some £390million – leaving us with a colossal shortfall.

For the small business owner like myself the figures are still as frightening and I can still see no long term strategy in place to assist me in keeping my business up and running. Yes, the Chancellor did announce a £2.5billion package and around 500,000 companies may benefit from a one year reduction in business rates but the increase in Employers’ National Insurance rates in 2011 will costs companies around £10billion.

Tax for the hardworking ordinary people also took an indirect hit. Whilst there was no tax increase, and for small things we have to be grateful, Darling did freeze the threshold levels. In real terms when this is related to the current rate of inflation of 3.7%, the Government will still manage to raise some £2.2 billion from us.

As I sit here pondering over the finer details of yesterday’s Budget, I shake my head in dismay. There are no positives here, there are no long term solutions here and there is no light shining at the end of the tunnel here. Darling and Brown have tried to temporarily fix the pot-holes and tried to keep the staunch Labour voters on board for the election but this budget had more water leaks than many of the London roads. Labour may well have hammered the final nail into the coffin – we will have to wait until May to see the real reaction from the voters.