Pre Budget Report November 2008

Alistair Darling delivered his pre-budget report. The main points

• Temporary 2.5% cut in VAT to 15% from 1st December for 13 months
• New 45% tax band for those earning more than £150 000
• National Insurance to go up by 0.5% in 2011
• £60 Christmas gift for pensioners
• Phased increase in vehicle excise duty

The key question is that will the government be able to pay for the increased borrowing caused by events such as bailing out failing financial institutions and financing wars in Iraq & Afghanistan.