Taxpayers in Northumberland will keep even more of their earnings following a hike in the tax-free personal allowance, announced by the Chancellor George Osborne in yesterday’s budget.
The allowance – the amount people earn before they have to start paying tax – will rise to £10,800 in 2016/17, and £11,000 the year after.
The increases to the personal allowance from £6,475 in 2010, to £11,000 in 2017/18 will save a typical taxpayer £905.
Plus from April 2016, a tax-free allowance of £1,000 (or £500 for higher-rate taxpayers) will be introduced for the interest that people earn on savings.
In terms of personal expenditure, fuel duty, originally due to rise in September, will be frozen again, resulting in the longest duty freeze in more than 20 years by the end of 2015/16.
For alcohol, there will be another penny off a pint, a two per cent cut for spirits and most ciders, and a freeze on duty on wine.
From a business perspective, the North East Chamber of Commerce was pleased with the announcements, which were seen as relatively positive, although it was thought that some major announcements were bypassed.
The group said that eliminating National Insurance payments for under 21s and the abolition of the annual tax return will make life easier for small businesses.