Budget 2009: They've ruined Britain
BRITAIN was last night braced for a decade of merciless tax rises after Alistair Darling’s Budget revealed the epic scale of Labour’s debt crisis.
A punitive 50 per cent income tax rate was slapped on top earners and their pensions plundered as the Government reverted to Old Labour-style class warfare.
But virtually every household in the country will be forced to foot the bill for years to come for the rampant borrowing of Labour that has ruined the country.
EXPRESS MONEY: YOUR AT-A-GLANCE GUIDE TO THE BUDGET 2009
With the national debt set to double to £1.4trillion in five years, families face crippling hikes in duty on petrol, alcohol and tobacco from today to raise £6billion by 2012.
Dire public finance figures show that Government borrowing will rocket to a record-busting £175billion this year and £703billion over the next five years.
Britain’s tax bill will spiral by more than £5billion over the next two years as a result of yesterday’s dramatic announcements.
And Government debt will soar to a shocking 79 per cent of GDP by 2013/14.
The Tories claim the total Budget package will leave the average household £1,000 a year worse off within two years.
And economic experts claimed that taxes may have steeply beyond 2020 to reduce the historic debt levels. In angry clashes in the House of Commons, David Cameron accused Labour of making an “utter mess” of Britain’s economy.
In a humiliating 50-minute Budget speech packed with bleak statistics, Mr Darling admitted emergency draconian measures were needed to deal with “the most serious global economic turmoil for over 60 years.”
He claimed: “This Budget will build on the strength of the British people, providing jobs and spreading prosperity.”
But he was forced to rewrite his economic forecasts, admitting Britain’s recession-hit economy will shrink by 3.5 per cent this year.
TOP BUDGET VIDEOS...
50 PER CENT TAX RATE FOR TOP EARNERS
The Chancellor insisted his measures promoted “fairness” by forcing the better-off to pay more.
And Lord Mandelson – one of the architects of New Labour – last night claimed the party was not “turning the clock back” to the old days of high taxation.
Senior Tories condemned the income tax rises but said reversing the measures would “not be a priority” for a future Conservative government.
Shadow Chief Secretary to the Treasury Philip Hammond said: “This can’t be our priority, we cannot propose to reverse the 50p rate. There are much more important priorities.”
The Tories would make reversing National Insurance rises on low and middle-income earners a key priority instead, he added.
Flagship measures in Mr Darling’s Budget will hammer people earning more than £100,000 a year and the moves shredded Labour’s pledges at every election since 1997 not to raise income tax.
Those on annual incomes over £150,000 will face a new 50 per cent top tax rate, recalling the supertax of the 1970s.
The move – to be imposed from next April – replaced a 45 per cent tax rate announced last autumn even before it had been introduced. They will also see their pension tax relief curbed from April 2011.
And personal tax allowances for people earning £100,000 will also be slashed. The income tax hikes – targeted at the country’s top 600,000 earners – were designed to raise an extra £2.1billion a year for helping to cut Government debt.
Mr Darling also slapped on a series of other tax hikes likely to penalise virtually every household in the country.
Fuel duty will go up by 2p from September, with a further 1p rise above the rate of inflation each April for the next four years. Alcohol duties went up by 2 per cent from midnight last night, while tobacco duty rose by 2 per cent. The rises will put 4p on a bottle of wine, 1p on a pint of beer and 7p on a packet of 20 cigarettes.
