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I really am starting to get very angry, with your posts Nick. Low income earners and small businesses **are** paying more. It is therefore **not** tax neutral for us.

The break-even point for the income-tax changes (excluding N.I contributions thresholds, and using 07-08 allowances) is £18,601 gross salary.

Workers earning less than this will be worse off as a result of the changes, unless Gordon Brown reduces N.I contributions for below-average earners.

This does not seem a good way to encourage people off the benefits system and into employment, does it?

I agree with point 1.
Who are you supporting here.
This a TAX the poor and give to the Rich budget.
This is not funny if you earn below £9,000. They have just had a 10% TAX increase on around 20% of there earnings.

But Emily, *any* change in taxation will surely leave some better off and some worse off - the budget may well be neutral *overall* - and I am sure Nick isn't writing his blog purely for your benefit...

I agree. As I work it out, anyone earning over £5000, but under £18000 will be paying more income tax. While I realise that wealth redistribution is too much to ask of this government, this is taking from the poor to give to 'middle England'.

As always with Brown lets wait two days to find out what has really happened. how much taxes have actually gone up. How much of this has been announced before. What reality did he get the inflation/growth/investment figures from because it certainly isn't this one. Even initially it doesn't look great. i.e increase tax on the poor to possibly reduce it on middle England although chances are national insurance increase will take care of any of that. Increase in education and health spending- does anyone really believe this, there will be a catch somewhere. Can you get Evan Davies to do a fact-check on what Brown has actually said and match it with reality e.g inward investment = selling British companies off to the highest bidder.

Are the ³ÉÈËÂÛ̳ going to report that it is only the Corproation Tax rate for companies earning more than £1.3m pounds that has been reduced? For small companies, the heart of our 'enterprise culture' the rate is increasing, hardly fair I would argue?

Also the personal allowances for individuals under 65 are unchanged thereby meaning people will pay tax due to the effects of inflation on wages.

I will actually be worser off! so itll only be tax neutral for those who earn over 30k. Who did these calculations, all he done is make the poorer pay more, I thought he was trying to alleviate poverty?

Also spending money on child poverty is not the problem its making sure existing money is spent correctly by the parents which often is not the case and you cannot control how many is spent no matter how much money is thrown at the problem.

What about us who are getting more and scared that we cant live "freely"?

It penalises the less well off, it goes after the 'gas guzzlers' but in the most timid way, it is just a move around. Nothing about reducing the size of government, nothing for those unable to get on the property ladder in the town where they live. And I am curious - why was there no increase in the duty on spirits ???

Its all smoke and mirrors, abolishing the 10p rate will hurt low earners not help them. Such an illusion will backfire when the people realise what a spin/deception it is. Most peoples wage packets will hardly be affected, and when they discover it, they will be most unhappy...and when they have to pay more for their petrol/and their council tax, they wont just be unhappy, they will be livid.

Although he has cut the headline rate of income tax, by scapping the 10% band and increased the threshold for employees national insurance contributions people will actually be worse off not better. As usual, plenty of gusto at the despatch box but no substance.

Nick,
Checking the red book in detail to establish not what was said, but what wasn't said. Has it always been like this, or is our present chancellor the first to hide the unpleasant "bits".
As the average man in the street, I don't trust Gordon Brown to tell me the whole truth. This budget just adds extra weight to this feeling. Not what you want from a Prime Minister in waiting.

Judging by the comments in the have your say forum not many people have been fooled by the 2p income tax "cut", given that it was preceded by the abolition of the 10% starting rate (which means that the lowest earners pay more tax - nice).

In fact, by only raising the upper threshold by a positively anaemic amount I doubt there are that many people who will greatly benefit from the changes to the income tax rates (and of course the national insurance changes have, as ever, been used as a stealth tax).

Bozo Brown introduced the 10% band to help those on low incomes.

Now he is abolishing it but charging 22% (ok 20% next year).

So poor people will pay twice as much in direct tax.

What sort of thinking is this for a "labour" chancellor????

Is he brain-dead??

There are so many people on low incomes that the extra £120 (approx) taken from their meagre salaries or pensions will make them even worse off.

What a prat - I suggest the poor vote him out.

G Seed

So why is Nick Robinson not giving greater prominence to Brown's doublespeak regarding the cutting of the basic rate of income tax? He says the Tories can't do it without cutting services. Why is it different when Brown does it?

I hope Robinson will highlight further examples of Brown stealing the Tories' clothes after suggesting that they were naked. They will surely come.

Emily, why are you angry with Nick? The Chancellor got his headline reductions, the fact there is no real gain for anyone, and some are paying more, is hardly Nick's fault unless he has some secret influence we don't know about.

From a top level strategic view, I’m in favour of as much simplicity, clarity, and effectiveness as possible. A flat tax system, no wiggle room for avoidance or fraud, and a reshaping of incomes is where I’d like to see things head. While some aspects of this have been delivered, I’m not too happy with the ill-treatment of the poor, unnecessary complexity of green taxes, and lack of long-term vision.

I’m having difficulty seeing how this budget translates into Gordon Brown being a suitable candidate for Prime Minister. It’s too showy, tricky, and fumbling for what, I believe, is the emerging undercurrent of public opinion, competent authority, and sound governance. This dance has been useful to this point but the wind is changing and, I think, a more straight and trustworthy approach is appropriate.

Complexity and shifting sands are the bane of our time. It piles patch upon patch, slaps people around, and is a weight that isn’t worth the bother. Like software development, The Treasury has a feature creep, fire fighting, bob and weave mentality. Why? I’d like to see a future Prime Minister do something about this and build a financial system built to last, and that has broad consensus.

Gawd. Someone give John Reid a prod.

Nick,

Regarding the base rate change, and the elimination of the 10% rate, doesn't that mean that thousands of pensioners who formerly got taxed at 10% on their nest egg's dividends will now get taxed at 20% thus creating a possibly substancial increase in revenue for the Chancellor?

The budget might be revenue neutral, but the 2p tax reduction and the abolishing of the 10p rate means in reality, for a lower earner of 10k, around £100.00 a year more tax to pay. Unlike Brown & Co we can't increase our MP's expenses to cover it !

Emily - any tax change will have winners and losers: i think what Nick meant is that OVERALL it is neutral. Like you, though, i find it disappointing that the losers in this instance are low earners and small businesses: the people who government should be helping.

Emily - Nick didn't say that it was tax neutral. He said that it was revenue neutral. There is a big difference.

Change to pensioners allowance.Do we have to wait until April 2008?

Emily, he never said it was. what he said was that it was revenue neutral- the govt is still taking the same amount of money they are just changing who they take it from or what bit of our money they take it from.

Its a candyfloss budget. It looks pretty, has plenty of spin, but it won't satisfy you and will leave you a nasty bill to stave off the inevitable decay that follows.

The headlines look nice but those on low incomes, who earn less than £19,000 a year, will actually pay more tax! How's that for redistribution of wealth.

Why not more coverage of the fact that a Labour Chancellor is increasing tax for lower earners to placate the middle class. Surely this is extraordinary and Tory.

How can Cameron allude to this being a budget for the leadership election?

Cutting income and corporation tax is hardly a vote winner amongst Labour members and the trade unions.

The truth is that Brown has pulled the rug from under the tories. Any belief that Cameron would out-gun Brown when he takes over as Prime Minister can firmly be laid to rest.

I for one am looking forward to the future battles. For the time being I think it is clearly Brown 1 Cameron 0

I have just beren listening to Drivetime on 5 live, and i think the reality of what has happened has just begun to sink in wuth the political journalissts, John Piennar even used my expression "Smoke and Mirrors" (see previous post)(he must have been reading your blog Nick !

keithfelming / Aaron / Scott

Did you watch the comment on ³ÉÈËÂÛ̳2? Have you read any of the ³ÉÈËÂÛ̳ "pundits" posts here?

Have any of them mentioned that even with tax credits many poor people will be worse off? Or has this been studiously avoided? Well I watched the whole thing and even when the female commentator mentioned this, Nick and co stepped in to pretend that tax credits would make it all ok, when they won't.

Has there been a mention of 3% direct increase in tax for small businesses who can least afford such a rise? No. Instead we are told they'll be able to get it back if they re-invest, which most small businesses cannot afford to do.

That's why I'm angry. It is utterly biased commentary. And noone who is affected is falling for it. The media have a duty to present the good and the bad, not just hide the bad bits under spin. It's not good enough.

For the first time in years it looks like i'm going to be better off as a higher tax payer (from 2008). Although this appears to be contrary to Browns redistribution of wealth agenda over the past 10 years so maybe we're all being hoodwinked.

Only the ³ÉÈËÂÛ̳ could headline a RISE in basic income tax from 10p to 20p as a 2p income tax cut!

Wake up Nick, if you are going to regurgitate New Labour spin at least make it smell like vomit.

Simon - "Brown has pulled the rug from under the tories"? Maybe, but I don't think so - I think Cameron et al will be delighted - Brown's big stick was to tell the public that the tories want to cut taxes and that'll hurt public services. That makes lots of people nervous. Now he cuts many people's marginal rate of income tax himself by a material amount. He no longer has that argument. And he has made the tories' one for them. I think Central Office will love it.

question have we been stuffed!
Reading the headlines theremoval of the 10% lower tax band will be offset by the reduction of the base rate from 22% to 20%
translated:-mr brown takes approx £6 billion with one hand and gives back approx £6 billion with the other hand!
NOT QUITE mr brown gives £6 billion in april08 but takes £6 billion in april07 so he gives nothing back tax year2007/2008!
THE NET RESULT THE BRITISH TAXPAPER HAS BEEN MUGGED WITH A WINDFALL TAX OF APPROX £6 BILLILON POUNDS

please let me know if my facts are wrong
ian leach

The point is that nobody is better off THIS year - all the supposed "give aways" have been deferred until next year. Does this suggest a 2008 May election for PM Brown???? (Hopefully the Labour Party will come to its senses and choose a different leader).

All I can say is that it's exactly the kind of budget one could have expected from Nigel Lawson.

Reading your comments Nick and having just watched your piece on the News at 6, I am surprised that there is no reference whatsoever to the idea that Brown's supposed tax cuts might indeed have an election in mind - the elections in Scotland in May, in which it appears Labour run the serious risk of being kicked out of power. So, isn't the Westminster Leadership issue you mentioned just so much fluff when there are practical issues of power in the Scottish Parliament at stake? After all if Labour do as badly as the polls suggest they might in those elections, the ramifications for G Brown as PM in Westminster could be, at the very least, embarrassing.

Nick I know you don't get out of the Westminster Village much however your view that it felt like an election budget is not only because there will be a leadership election but that there will be elections in Scotland for the Parliament and the Councils.

Gordon Brown with this Budget implles that he also intends to be Chancellor of the Exchequer if and when he becomes PM.

"All I can say is that it's exactly the kind of budget one could have expected from Nigel Lawson."

You're joking, right? When the Tories cut taxes in the 80's they did it properly, they actually gave money back to ordinary people, this budget merely shifts it around.

How people can be fooled into thinking GB's a tax cutter when he has raised taxes to extraordinary levels over the past 10 years. He is a tax and spend chancellor and always will be.