Chancellor George Osborne delivered his budget for the 2012/2013 fiscal year to parliament on Wednesday.
Following are highlights from his statement.
PERSONAL TAX ALLOWANCE
I am announcing the largest ever increase in the personal allowance - the amount people can earn tax free. From next April that amount will increase by £1,100. Every working person on low or middle incomes will benefit. People will be able to earn up to £9,205 before they have to pay any tax.
Instead of withdrawing child benefit all at once when people earn more than the higher rate threshold - the benefit will only be withdrawn when someone in the household has an income of more than £50,000. And the withdrawal will be gradual, 1% of child benefit for every extra £100 earned over £50,000 so there is no cliff-edge, and only those with an income of more than £60,000 lose all their child benefit.
This means an extra 750,000 families will keep some or all of their child benefit. 90% of all families will remain eligible for child benefit.
CUT IN 50 PENCE TAX
The direct cost is only £100 million a year. Indeed HMRC calculate the loss of other tax revenues may even cancel that out. So from April next year, the top rate of tax will be 45p.
From midnight tonight, we will introduce a new Stamp Duty Land Tax rate of 7 per cent on properties worth more than 2 million pounds.
I am increasing the Stamp Duty Land Tax charge applied to residential properties over £2 million bought into a corporate envelope. The charge will be 15%. And it will take effect today.
I am also increasing the rate of the bank levy to 0.105 per cent from next January, so that the additional corporation tax cuts do not benefit the banks; and so our levy will raise the 2.5 billion pounds a year that we said it would.
From next month, Britain will have a corporation tax rate of just 24%.
And we will continue with the two further cuts planned next year and the year after, So that by 2014, Britain will have a 22% rate of corporation tax. The biggest sustained reduction in business tax rates for a generation.
SOVEREIGN WEALTH,PENSION FUND INVESTMENT
we're actively seeking investment from overseas pension and sovereign wealth funds - and working to develop London as a new offshore market for the Chinese currency.
We also want investment from British pension funds in British infrastructure - and we're now working with a dozen of the largest pension schemes specifically on that.
TAX CREDITS FOR CREATIVE INDUSTRY
The film tax credit, protected in our spending review, helped generate over £1 billion of film production investment in the UK last year alone.
Today I am announcing our intention to introduce similar schemes for the video games, animation and high-end TV production industries.
NORTH SEA OIL FIELD ALLOWANCE
We are also introducing new allowances including a 3 billion pounds new field allowance for large and deep fields to open up West of Shetland, the last area of the basin left to be developed. A huge boost for investment in the North Sea.
We are also taking the opportunity to rebuild Britain's reserves, which had fallen to historically low levels. I can confirm our gold holdings have risen in value to 11 billion pounds.
The Debt Management Office will consult on the case for issuing gilts with maturities longer than 50 years, and the case for a perpetual gilt with no fixed redemption date - something Britain last felt able to issue six decades ago.
One area where future government spending is expected to be lower than planned is Afghanistan... The cost of operations - which are funded by the Government's Special Reserve and entirely separate from the defence budget - are expected to be a total of 2.4 billion pounds lower than planned over the remainder of the Parliament.
STATE PENSION AGE
I've also said that we would consider proposals to manage future increases in the state pension age, beyond the increases already announced.
In my first Budget, I set the Government the fiscal mandate of achieving a cyclically-adjusted current balance by the end of the five year horizon.
The OBR confirm today that we are on course to achieve that mandate, and have eliminated the structural current deficit by 2016-17.
They also confirm that we are also on course to reach our target for debt to be falling as a percentage of national income by the end of the Parliament in 2015-16.
Public Sector Net Debt is now set to peak at 76.3% in 2014-15, almost 2% lower than previously forecast - before falling the following year.
The deficit is falling and is forecast to reach 7.6% next year.
Borrowing this year is set to come in at 126 billion pounds, 1 billion pounds lower than I forecast in the autumn. And over 30 billion pounds a year lower than its peak the year before we came to office.
Borrowing will then fall to 120 billion pounds next year, if you exclude the transfer of Royal Mail pension assets. It will then fall to 98 billion pounds in 2013-14; then 75 billion; then 52 billion; reaching 21 billion by 2016-17.
So in total, borrowing is 11 billion pounds less than I last forecast in the Autumn.
The OBR's overall assessment of the outlook and risks for the British economy is broadly unchanged since last November's report.
The OBR expect the British economy to avoid a technical recession with positive growth in the first quarter of this year.
They say that the British economy has carried a little more momentum into the new year than previously anticipated.
Indeed, the Office for Budget Responsibility is slightly revising up in their growth forecast for the UK this year to 0.8%. They then forecast 2% next year; 2.7% in 2014; And 3% in both 2015 and 2016.
(Reporting by UK bureau)