Summary of Emergency Budget 2010 measures

I’ve seen a lot of different measures from today’s budget quoted in the media, so I thought I’d try to summarise some of the key points in one place for quick reference!

Headline Figures

By 2015/2016….

  • Spending cuts will have reached £99 billion per year.
  • Taxes to rise by £29 billion per year.
  • Total consolidation of £128 billion per year.
  • Government spending to fall to 40% of GDP from 48% in 2010.
  • Tax receipts to rise to 39% of GDP from 37% in 2010.
  • Public sector net debt to be 67.4% of GDP, after peaking at 70.3% in 2013-2014.

Tax changes

  • VAT is rising to 20% from 4th January 2011.
  • Personal income tax allowance for under 65s is rising by £1000 to £7475. Should bring 880,000 low income tax payers out of tax. However, basic rate and higher rate earning limits will be reduced to ensure that higher rate payers do not benefit from the increased personal allowance. The exact figures will be published in September.
  • Employers NI Thresholds will rise by £21 a week (but the NI rate is also rising as per the March budget).
  • Capital gains tax kept at 18% for basic rate tax payers, but rising to 28% for higher rate payers (capital gains added to income to determine if someone is a higher rate payer). The annual exemption will continue to rise inline with inflation, and will remain at £10,100 in 2010/2011.
  • 10% Entrepreneur relief rate allowances raised from £2 million to £5 million of lifetime gains.
  • The main rate of Corporation Tax is to be cut from 28% to 24% by 1% a year over 4 years. The small companies rate will be reduced from 21% to 20%. Starting in April 2011.
  • R&D: The government plans to consult with business to review the taxation of intellectual property, the support R&D tax credits provide for innovation and the proposals of the Dyson Review.
  • No rise in duty on cigarettes, alcohol or fuel (although VAT rise will apply to them). Government is looking into a fuel price stabiliser, and fuel subsidies for rural residents.
  • New businesses setting up outside the South East and London will be exempt from the first £5000 of N.I. payments for the first 10 workers.
  • New levy on banks’ balance sheets (0.03% of total size minus insured retail deposits and capital)


  • Child benefit frozen for three years.
  • Tax credits reduced for families earning £40,000+ per year, but increased for low earners – amount per child to raise by £150 per year per child above inflation.
  • Housing benefits capped at £400 per week for 4 bedroom or larger properties, with lower caps for smaller properties (3 beds – £340, 2 beds – £290, 1 bed flat – £250).
  • State pensions to be given triple guarantee – they will rise annually by the greater of earnings, prices or 2.5%.
  • State pension age to rise to 66.

Public Sector

  • 25% cut in spending across all government departments except health and foreign aid. Includes education, defence, local government etc..
  • Public sector workers earning more than £21,000 per year to have pay frozen for 2 years. Workers earning below this will receive a flat rate increase of £250 per year.
  • Public sector pensions to rise only by CPI (which is generally lower than RPI).


  • Aiming for cyclically adjusted current budget balance (excludes debt interest, cyclical payments such extra unemployment benefits because we’re in recession, and also capital spending / investment) by 2015/2016.
  • Aiming for public sector net debt as a percentage of GDP to be falling from 2015-16 onwards.

As an investor who seeks to make long term investments in small businesses, this budget is encouraging.

Typos / Errors

  • Page 15: Table 1.1 2014/2015 total numbers for spending and tax don’t add up (83 + 29 != 113).
  • Page 18: incresase should be increase.

How to tab between all fields in OSX

I like to use the keyboard wherever possible, but by default tabbing to certain fields in OSX is disabled. For example, if you try to access a password protected website in Safari, and it pops up with the name and password box, you can’t tab to the “Remember this password in my keychain field”.

However, it is very easy to fix this:

  • Open up System Preferences > Keyboard
  • At the bottom of this window is a section labelled “Full Keyboard Access”. Click the “all controls” option.

And that’s it! You should now be able to tab cycle between all fields including the remember password field in password prompts.