Today’s emergency Budget sets out a decisive five-year plan to rebuild the British economy, introduce a fairer tax system and ensure prosperity is more equally shared between all parts of the UK - including Wales, said Welsh Secretary Cheryl Gillan.
The balanced package of measures announced by Chancellor George Osborne today will help tackle the largest budget deficit in peacetime history, while safeguarding support for the poorest and most vulnerable in our society, she added.
Mrs Gillan said: “This unavoidable Budget has been tough but fair, based on the principles of responsibility, freedom and fairness. It will help our country pay the bills for the overspending of the past, while restoring confidence in the economy and planning for a more prosperous future for Wales and the rest of the UK.
“Plans for more balanced and sustainable growth will ensure future prosperity is shared more fairly across the country, unlike the last decade when some regions did so much better than others. Measures announced today will benefit thousands of businesses across Wales. For example, a three-year scheme will exempt businesses outside London, the South East and the East from up to £5,000 of employer National Insurance Contributions for each of their first 10 employees hired.”
Mrs Gillan also welcomed tax reforms that will benefit businesses and individuals in Wales. She said: “Corporate Tax reductions will show the world that Wales is open for business.
“As we promised in the election, we will stop the most damaging part of the jobs tax that would have put low paid people out of work and done so much damage to our recovery. Companies can now set up business, invest and create jobs in Wales, reassured by the Government commitment to create the most competitive corporate tax system in the G20.”
An estimated 4,100 individuals in Wales could also benefit from the decision not to repeal the special tax rules for furnished holiday lettings, as was proposed in the 2009 Budget. Mrs Gillan said: “I know this will be welcomed by the Welsh tourist industry, which is so vital to our economy.”
Mrs Gillan said that welfare reforms will protect the poorest, pensioners and the lowest paid in Wales: “As the Chancellor said, every part of society will contribute to reducing the deficit, but the richest will pay the most and the most vulnerable will be protected - especially the young and the old - so that despite saving billions of pounds this Budget will not increase child poverty.”
She added: “In Wales almost 1.1million basic rate taxpayers will benefit by up to £170 each by the £1,000 increase in income tax personal allowance for those aged under 65. Around 600,000 Welsh pensioners will also benefit from the Chancellor’s decision to relink the basic pension to earnings, with a guaranteed increase every year so that we can give people dignity in retirement.”
Mrs Gillan added the future budget for the Welsh Assembly Government would be determined by the Spending Review on 20 October. In the meantime, there are no new Barnett consequentials for Wales in this budget apart from a small adjustment to the business rate relief package announced as part of the recycling of savings on 24 May.