Budget helps to cement Olympic legacy

By Tom Mackintosh

Usain Bolt will be among a host of non-resident athletes to benefit from new legislation after the Chancellor’s budget revealed plans to relax tax laws during the London Anniversary Games.

George Osborne announced a one-off income tax exemption for overseas Olympians and Paralympians taking part in a repeat of last year’s track and field event.

The decision will mean athletes will not have to pay income tax on appearance fees, prize money and endorsement income earned in relation to the three-day event.

The event, which will be held at the Olympic Stadium in July, will mark the one year anniversary of the London 2012 opening ceremony and help maintain the Olympic legacy.

Osborne said: “The Government is determined to do everything possible to secure the Olympic legacy and I am delighted to grant this exemption.”

The temporary exemption in the Chancellor’s budget will persuade top athletes, such as Bolt, to participate when usual non-resident tax rules would prevent them from competing.

Bolt stole the show last summer winning gold in the 100 metre, 200 metre and 400 metre relay running events in blistering pace to secure his legendary sporting status.

The reappearance of the eight-time gold medal winner would boost the calibre of the event by luring back other high profile athletes and other international interest.

Sports Minister Hugh Robertson welcomed the decision: “We want to attract the very best athletes, and this helps us do that.”

The financial constraints for foreign athletes with no provision in place could discourage them from taking part as they would make an overall financial loss.

Not only does the UK claim a proportion of the prize money and appearance fees, they also demand a share of sponsorship income.

The Government intend to include the policy as part of this year’s Finance Bill with the exemption applying only to income tax and will not cover resident athletes.

Brighton smokers feeling the pinch of 2012 Budget

By Paul Lacey

Smokers in Brighton are already feeling the effect of the increase in tobacco duty with decreased sales and ‘brand flipping’.

Only eight days after the Chancellor announced a 5% rise above inflation on tobacco duty in the 2012 Budget, Brightonians have already started to change their smoking habit.

Price rises have yet to hit customers of smaller retailers due to their stocks of pre-pricemarked cigarettes but larger stores have already reported a slight decrease in sales.

Steven Paris, 25, from the Co-op convenience store in St. James Street said: “Customers complain about the rises and many have switched to rolling tobacco or just buy 10 instead of 20.”

This early indicator may vindicate the Chancellor George Osborne when he said: “There is clear evidence that increasing the cost of tobacco encourages smokers to quit.”

However, not everyone is convinced that the increase will deter smokers and even suggest that the real reason for the duty rise is to gain more revenue by unfairly targeting the less affluent.

Phil Knight, 45, from Brighton, said: “It [the rises] selectively penalises poorer people because it’s a greater portion of their income.”

He added: “If you want to raise more money for the country, you should be taking it from the richer part of the population.”

Other Brightonians however agreed with the rises and thought that paying another 37 pence per packet of 20 was a good move by the government.

Morgan Keef, 24, said: “It should be more expensive as if it’s too cheap, it encourages more people to smoke, although hardcore smokers will always find a way to fund their habit.”

Brighton suffering from the Budget blues?

Chancellor fo the Exchequer, George Osborne.
Credit: Mholland

Mention the 2012 Budget to most people, and it’s unlikely to conjure excitement, but at the very least you might expect it to hold a certain morbid fascination. After all, when George Osborne and his colleagues squeeze the country’s spending and tinker with taxation, it’s we who are affected. But judging by the reactions of Brighton residents, it seems that a climate of despondency fostered by a prevailing economic insecurity means most people are not even interested in reading it.

Although many were unaware of the finer (some might say confusing) details of the document, there was a general perception that it is weighted unfairly, penalising the middle-classes and the vulnerable without even delivering the support to businesses that had been promised.

UK Budget 2012

By Evie Purves

With most of the budget provisions leaked over the past few days, there were few surprises in Chancellor George Osborne’s speech.

Unsurprisingly, the top rate of income tax has now been cut from 50p to 45p which will come into effect in April 2013, meaning that millionaires will effectively pay less tax.

The HMRC found that after reviewing the effectiveness of the 50p tax rate, it has caused “massive distortions” and only raised one third of the £3bn which was their target.

But workers earning £20,000 a year would be £253 worse off from April, and families on the minimum wage who were unable to work more than 16 hours would lose nearly £4,000 as a result of changes to tax credit rules.

George Osborne says the treasury will receive “five times more money each and every year from the wealthiest in our society”. The UK economy is set to grow much quicker this year than previously forecast.

Andrew Goodwin, senior economic adviser to the Ernst & Young ITEM Club has said this was “generally a steady, but business-friendly, Budget.”

But others strongly disagree, calling it “a budget for the rich” and stating that it is “outrageous”.

The chancellor also introduced a surprise penalty tax rate of 15% on properties held in offshore companies to avoid stamp duty as well as increasing stamp duty on homes costing more than £2 million.

Despite the rich being made richer, it seems that pensioners are being hit hardest. Osborne’s announcement to freeze the pensioner’s tax allowance will leave four million pensioners £83 a year worse off by 2014. Despite this, the chancellor still insisted that no one would be losing any money.

This new scheme will save the Treasury £360 million next year, £670 million in 2014, £1 billion in 2015 and £1.25 billion in 2016.

The blow to pensioners comes after it emerged this month that the cost of living for the UK’s 10.6 million pensioners has risen by a third since 2000.

The average retired couple spends £17,922 a year to live, up from around £13,500 at the turn of the Millennium.

Ed Miliband – leader of the opposition has dubbed the new budget as “a budget for millionaires” The Labour leader attacked the budget as “unfair, out of touch, for the few not the many”. It was based on the “wrong choices, wrong priorities, wrong values” from the “same old Tories”.

Landlord Jake Kelly says the budget is “ridiculous” and now has to cut his own staff hours “to be able to afford to keep this small pub open”.

Miliband snubbed the Tories budget plan and said “This budget will be remembered for its failure on growth and jobs and the top rate tax cut” and added: “Today marks the end of ‘we are all in it together’.”