It has been an extremely busy week in the House of Commons. On Tuesday, the Queen celebrated her Diamond Jubilee in a landmark address made in Westminster Hall to both Houses of Parliament. The Queen and The Duke of Edinburgh will be visiting the West Midlands on 11 & 12 July, to commemorate Her Majesty’s 60 year reign.
On Wednesday, Chancellor George Osborne delivered his budget for this year – a radical, reforming budget which will help Britain earn its way in the world. It is a budget for working people and unashamedly backs business. It puts this Government on the side of those who aspire to do better for themselves and their families and sticks to the plan to deal with Labour’s debts to create a brighter future for the next generation.
This is a budget with far reaching tax reform which will affect many of my constituents. The Government wants to help working families on middle and lower incomes and the Chancellor announced the largest ever increase in the personal tax allowance that will benefit 24 million ordinary families across the UK. Most basic rate tax payers will gain £220 every year and in total this Government will have taken two million low paid people out of tax altogether. In the West Midlands this change will lift an additional 74,000 people out of income tax and benefit 1.9 million individuals. In total the Government will have lifted 176,000 people in the region out of income tax altogether.
The Chancellor also announced reducing the top rate of income tax by 5p, to 45p, so that Britain no longer has the highest rate of income tax of any major economy. The 50p rate was damaging our economy and raises next to nothing. However, we are sticking to our pledge that it should not be reduced while the whole of the public sector faces a pay freeze and it will, therefore, be introduced from April 2013. Instead, the Budget introduces several new taxes on the richest in our society, including a cap on tax reliefs and a new 7 per cent rate of stamp duty. In addition, there is a 1 per cent cut in corporation tax to boost investment and jobs. By April 2012 we will have a 22 per cent corporation tax which is a sign to the rest of the world that Britain is a good place in which to do business.
I am glad that The Birmingham Chamber of Commerce welcomed the decision to cut the 50p income tax rate which they believe is a recipe for growth and job creation across the West Midlands and that they have applauded the Chancellor for his commitment to accelerating business growth by reducing corporation tax.
This Budget reaffirms our unwavering commitment to deal with Britain’s debts. Under Labour this country borrowed itself into trouble, now we are going to earn our way out. We are sticking to our plan and our credibility is helping to keep interest rates low for households and businesses in the UK.