If you’re reading this you may be thinking:”Why is NUBI covering something boring like the Budget? Shouldn’t you be writing about bees?” Boring though the Summer Budget may be, it’s also pretty important to know about if you’re a student, an employee, or anybody who still uses the money system to pay for goods and services. If you’re an anarcho-syndicalist who has left capitalist society forever to live in the hills under a barter economy, then you probably don’t need to be here. For everyone else, here’s what George Osborne has in store for you…
Every Treasury Budget is like an episode of Game of Thrones, you always go in not knowing which expenditure will die before the credits roll. One high profile casualty this year is the Maintenance Grant part of Student Finance. Many students from low income backgrounds used to be able to get this sum of money to help with living costs and they wouldn’t have to worry about paying it back.
Now those students will have to take that money out as a loan and pay it back. However, the amount low income students could receive has increased to a maximum of £8,200, a rise of £766 on the previous available sum, so there’s a silver lining.
You could always look on the bright side, as graduates don’t have to repay their loan until they’re earning more than £21,000 a year you may not have to pay it back for a while! Although there’s some bad news if you ever have to be…
Working age benefits will be frozen from 2016-17, meaning the amounts paid out will not rise with inflation; this includes Housing Benefit for private renters and tax credits, although Maternity and Paternity related benefits and sick pay will be safe.
The amount of benefits a household can claim has also been reduced to £20,000 a year (Londoners get £23,000), and Child Tax Credit will only be limited to 2 children from April 2017 – if you have more than 2 children after that date they won’t be covered. Could this be the government’s way of discouraging low income families from having more children than they can support?
If you’re a jobseeker between 18 and 21 and on Universal Credit (the new face of benefits coming to a Job Centre near you), you will have to enrol in an apprenticeship or a work placement if you haven’t found a job after 6 months. However, if you do find a job things are going to start looking up for all you…
The Government wants to introduce a new National Living Wage of £7.20 an hour from April next year, with the ultimate goal being £9 an hour by 2020. This is all for over-25s though, meaning the government will be continuing its bold policy of “all under-25s are screwed” over the next 5 years.
You can, however, earn up to £11,000 a year from 2016 before the government will start charging you for Income Tax, although if your wages have risen above that thanks to the Living Wage up there then it’s back to taxation for you.
If you’re a working family you will have 30 hours of free childcare a week, even if your children are 3 or 4 – double that of the 15 hours families get at the moment. You’ll still have to worry about…
The government will introduce a new road tax targeting high emission cars from 2017 – in the first year you will have to pay a rate based on your car’s emissions, after that there will be a flat rate of £140 across the board. In order to avoid this rate you will have to buy a zero emissions car to pay zero. This seems like an incentive for motorists and the motor industry to move to cleaner, greener transport.
However, this only applies to cars bought after the start of the financial year in 2017 – as that doesn’t start until April, March 2017 might be a very cheap time to buy your first car from a dealer trying to offload the taxable models before he has to tell everyone about that extra £140 tax rate! No guarantees about the price of petrol or insurance, though.
The Chancellor has also announced a series of initiatives aimed at taking down corporate tax evasion. HMRC (the tax people) will get more money, more access to business data, and the government wants to triple the amount of criminal investigations into tax crimes committed by big companies and the wealthy. They also want to close loopholes that allow people to pay less Capital Gains Tax (tax on profit) and make sure international companies pay tax on profits they divert from the UK. Wake up and smell the coffee, Starbucks!
With any Budget there are winners and losers. Winners this time around include working families with young children, people eligible for the living wage, and electric car manufacturers. The losers? Students that don’t want to incur more debt, young unemployed people, and tax evaders.
I’ve mentioned what I think most people will want to hear about, but there’s a lot more announcements and information on things such as Inheritance Tax, Employee Allowances and more on the official GOV.UK Summer Budget website! How’s that for a fun evening?