Economic Forecasts
Growth - Estimate for economic growth this year has been cut by 0.5 percentage points to 2 to 2.5 per cent, but next year's forecast is unchanged at 3 to 3.5 per cent.

Public debt - Public sector net borrowing for 2003/04 is estimated at £27bn, £24bn in 2004/05. Public sector net debt is estimated at 32.2 per cent of national income in 2003/04.

Budget deficit - The Budget deficit was £12bn in 2002/03 and is forecast to fall to £8bn in 2003/04 and £1bn in 2004/05.

Inflation - The inflation forecast was kept at 2.5 per cent for next year. Fourth quarter inflation this year is expected to be 2.75 per cent.

Costs of War
Iraq and at home - A total of £3bn is set aside to pay for the conflict in Iraq. A further £332m is set aside for domestic counter-terrorism measures over the next three years.

Personal Tax
Rates and thresholds - Capital gains tax rates were frozen and the capital gains tax annual exemption rose to £7,900. The inheritance tax threshold rose to £255,000.

Allowances - Personal tax allowances for 2003/04 have been frozen at 2002/03 levels for under 65s, but over 65s gain above-inflation rises. Basic and higher rate tax thresholds have increased in line with inflation.

Leisure
Alcohol and cigarettes - Tax on a pint of beer increased by 1p, and tax on a bottle of wine rose by 4p. Tax on cider and sparkling wine is frozen. Tax on spirits is frozen for a sixth successive year. The price of cigarettes increased by 8p per pack of 20.

Motorists
Fuel and excise duty - Fuel duty increases have been deferred for six months and vehicle excise duty for lorries and motorcycles is frozen. This means that the annual revalorisation of the main road fuel duties will be delayed to 1 October. Vehicle excise duty for cars and vans was increased in line with inflation, meaning a £5 increase from May.

Environment
Fuels - New duty incentives introduced for bioethanol and sulphur-free fuels.
Cars - A lower rate of vehicle excise duty will be introduced for the most environmentally friendly cars.

Stamp Duty
Residential and business property - Stamp duty on homes and business property purchases is frozen. Measures were announced to tackle stamp duty avoidance. Exemption levels are increased for non-residential properties. A new lease duty rate of 1 per cent will be introduced from December 1, subject to consultation.

Homes
Housing development - The Government will be able to intervene on some big housing development decisions.
Supply - A review will look at issues affecting housing supply in the UK, including competition and the capacity and finance of the house-building industry.
Mortgage rates - A review of the UK mortgage market will assess factors limiting the development of the market for fixed and long-term fixed rate mortgages.

Employment
Job seekers - Job centres will have greater flexibility and discretion to address employment barriers. Those unemployed for 13 weeks or more will have to travel up to 90 minutes from home to accept work.

Euro
Economic tests - The Government reiterated that it would give its assessment of the five economic tests for euro entry by 7 June.

Families
Trust funds - Each child born from 1 September 2002 will have a Child Trust Fund with an initial endowment of £250, rising to £500 for children in low-income families. Parents and grandparents will be able to contribute to trust funds up to an annual limit of £1,000.

Pensioners
Hospital stays - Pensioners will receive full state pensions during hospital stays of less than a year, instead of having them reduced after six weeks.
Winter fuel - Winter fuel payment rises by £100 to £300 for households with over-80s.

An Enterprise Budget?

The Key Announcements

Tax for Business
Research and Development - The Treasury will improve the scope of research and development tax credits. The minimum expenditure threshold is reduced to £10,000.
Capital allowances - The qualifying threshold for capital allowances for small and medium enterprises to become eligible for the 40 per cent investment allowance will rise to the European maximum of £20m.
VAT threshold - Companies with turnover of £56,000 or less with be exempt from VAT. The Government will abolish automatic fines for late payment for up to 200,000 additional small businesses.
The rate of capital gains tax, corporation tax, climate change levy, air passenger tax and insurance premium tax frozen.
Stamp duty on business property frozen. Duty on leases replaced with 1 per cent charge on rent payments, from 1 December.

Business
IT Investment - IT investment allowances that include 3.7m businesses will be extended for another year.
Small businesses - Proposals for the creation of British Small Business Investment Companies - US-style private sector vehicles to inject new capital into small and medium-sized firms.
Three new tax reliefs and incentives for small and medium-sized businesses.
Work permits for skilled migrants expanded.

article dated 05/2003