Britain’s Finance Minister, Gordon Brown, has delivered his budget speech setting out the UK government’s spending and tax priorities for the year.
With the economy having grown 3.1% last year, Brown was able to boast: “Britain is today experiencing the longest period of sustained economic growth since records began in the year 1701. And the foundation of this Budget is our determination to maintain British stability and growth.” He forecast GDP in Britain will increase by between 3% and 3.5% this year. His growth projection is well above most economist forecasts. The Organisation for Economic Co-operation and Development is talking about 2.6%.
If the economy does not grow as fast as he is predicting, it means there will not be the money available for increased spending on such areas as health and education.
With a parliamentary election widely predicted for early May, it was expected this would be a budget designed to win votes, but there were no major give aways. He did freeze much of the tax the government collects on various goods and services, although taxes on cigarettes and wine will go up.
Plans to freeze the corporate and capital gains tax were also revealed.
And he announced tax relief for home buyers and pensioners.
Brown said the UK is “the most stable and least volatile of all the industrialised countries” and predicted inflation would remain under control, at 1.75% this year and 2% for the years beyond that.