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Today's Budget Pointers: What's up, what's down
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*As supplied by the Government:
Macro economic position
• GDP last year £954 million – grew 6.5% (growth in
economy).
• GDP 2010/11 provisionally estimated at £1 billion –
growth of 5%
• Jobs in economy as at October 2010: 20,975, a record
high. 525 additional
jobs in year. 546 up in private sector, 20 up in MOD and
41 down in public sector.
• Gibraltarians in employment at record high of 10,706.
• Government surplus 2010/11: £31 million
• Capital expenditure 2010/11: £158 million
• Net Government debt: £217 million. 23% of GDP.
Budget Measures
• All taxpayers on Allowance Based System will receive
tax cut of at least
£300 or 2% of tax now paid, whichever is greater. This
will be received by
the 2500 taxpayers who are already paying an effective
rate of tax lower than that that will be paid by Gross Income Based
taxpayers.
• 1900 taxpayers presently on income Based System will
now be better off under the Gross Income Based System and will receive
more than £300 or2%.
• In the Gross Income Based System the top rate reduced
to 28%, the bottom rate is lowered to 6% and the income bands are
changed, delivering tax cuts of £160 to £1460 to 13,450
taxpayers.
• Effect of above tax cuts and other changes is that
o Everyone earning up to £8,000 p.a will continue to pay
zero tax
o Everyone earning up to £15,000 p.a. will now pay tax
at an effective rate lower than 11%
o Everyone earning up to £20,000 at an effective rate
lower than 15%
o Everyone earning up to £25,000 at an effective rate
lower than 17%
o Everyone earning up to £40,000 at an effective rate
lower than 20%
o The maximum effective rate of tax in Gibraltar is now
24.99% (not reached until income of £300,000) and the rate begins to
fall.
• As a result of these tax cuts
o 43% of people who pay tax now do so at an effective
rate less than 15%
o 85% of people who pay tax now do so at an effective
rate less than 20%
o 100% of taxpayers who pay tax now do so at an
effective rate less than 25%
• Another opportunity for married women to pay
difference between married women and full social insurance contribution
rate for pensions
• Child Welfare grant available for first child at £25
per month
• Unemployment benefit up 10%
• Two week paternity allowance established at £87.64 per
week, as per maternity allowance
• Sponsored Patients Scheme maximum daily allowance
increased to £61 per day for both UK and Spain
• 6% increase in university student maintenance grants.
Increase worth
£261 outside London and £358 in London.
• Rates early payment discount restored to 20% for
retail and wholesale
sector, including bars and restaurants
• Additional 10% rates refund for bars and restaurants
that do not permit smoking
• Import duty reduced from 12% to 6% on the following
goods:
o Televisions
o Hi fi and other electronic or electrical audio or
visual equipment
and accessories
o Tableware and kitchenware
o Other household goods
o Sunglasses and spectacles
o Lamps and lighting
o Paints and varnishes
o Tools
o Toys
o Porcelain and glass objects and ornamental goods
• Import duty up 12p per pack of 20 on cigarettes and
£2.50 for a 250 gram pouch of rolling tobacco
• Public sector pay rise of 2.5% despite no rise in UK
• Average electricity bills will rise 3% (less than
inflation and cost rises)
- 04.07.2011
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