GDP GROWTH is forecast to be 1.75 per cent this year, rising to between 2.5 per cent and 3 per cent in 2000, and 2.25-2.75 per cent in 2001 The current budget will be in surplus by pounds 9.5bn this year. In subsequent years the surplus is forecast to be pounds 11bn in 2000, pounds 13bn in 2001, pounds 13bn in 2002, pounds 12bn in 2003 and pounds 11bn in 2004. The debt share of national income will be 38.2 per cent of GDP at the end of this year and 37 per cent at the end of 2000. It is pledged to be below 40 per cent over the economic cycle.
CAPITAL GAINS tax will be cut from 40 per cent to 22 per cent on investments held for more three years and to 10 per cent after five years. All shares held by employees for more than five years will be exempt from income tax and capital gains tax. Employees will be able to receive shares worth up to pounds 3,000 in their companies free of income tax. Locally-based Venture Capital Funds to be set up in each region. Large companies that invest in growing companies will receive a tax relief of 20 per cent.
THE CLIMATE Change Levy is projected to raise pounds 1bn - down from pounds 1.7bn. Renewable energy sources and combined heat and power to be exempt from energy tax. Extrarevenue from fuel-duty rises to be ring-fenced for investment in roads and public transport.
THE GOVERNMENT intends to extend New Deal 25-plus across the country next year, including the offer of a job with a private-sector employer, work-based training or work-preparation programmes.
There will be a tougher approach towards the long-term jobless, with advisers identifying vacancies for which people are expected to apply.
ALL HOUSEHOLDS with a member who is 75 years or older will from autumn 2000 receive a pounds 101 television licence for free. The move will cost pounds 300m a year.
The starting rate of tax on savings will be cut from 20 per cent to 10 per cent, a move that will particularly aid the less-well-off pensioners with incomes above benefit levels. There will be a permanent extension of the pensioners' pounds 100 winter allowance.
EXTRA REVENUE raised through real increases in tobacco duties will be spent on improved health care. A 5 per cent real gain in tobacco duty would net pounds 300m. Cigarette packets will be marked to show duty has been paid, and measures would be taken to combat fraud, with tougher penalties for smugglers. Introduction of national network of container scanners.
A COMMITMENT to cut child poverty by half in a decade and eliminate it in 20 years. An integration of Children's Tax Credit and the child elements to the Working Families' Tax Credit and Income Support into a single child credit paid to the main carer. Consultations on a new Children's Fund to support voluntary and community organisations in their work with children in poverty.
THE CHANCELLOR will set up a new task force, headed by Lord Grabiner, QC, to investigate benefit and tax fraud. The panel will consider requiring people suspected of making fraudulent claims to sign on every day.
THE COMMITMENT of a further pounds 150m to treble the number of schools being modernised to 15,000 by 2001.Reuse content