Rates and allowances for Income Tax, National Insurance Contributions the Working and Child Tax Credits, Child Benefit/Guardian’s Allowance, fuel duties, alcohol duties, vehicle excise duties and stamp duty land tax are set out below.

*Married couple's allowance is given at the rate of 10 per cent.

* The rate of tax applicable to savings income in Section 1A ICTA 1988 remains at 20 per cent for income between the
starting and basic rate limits. The rates applicable to dividends are 10 per cent for income up to the basic rate limit and 32.5 per cent above that.

*The 2005 Pre- Budget Report announced that the starting rate and non-corporate distribution rate would be replaced with a single banding for small companies set at the existing small companies’ rate.

Child Benefit and Guardian’s Allowance rates from 10 April 2006

Duty on the premium is the same as for transfers of land (except that special rules apply for premium where rent exceeds £600 annually). Duty on the rent is charged on the Net Present Value (NPV). A per cent rate applies to the amount of NPV in excess of the threshold.

The rate of stamp duty/stamp duty reserve tax on the transfer of shares and securities is unchanged at 0.5 per cent for 2006-07.

From 6pm on 22 March 2006, tobacco duty rates will be:

* Tax refers to duty plus VAT

From midnight on 26 March 2006, duties on alcohol will be:

* Tax refers to duty plus VAT

All fuel duty rate changes will take effect from 1 September 2006.

The Chancellor announced today that the income tax starting rate limit and basic rate limit are to increase in line with indexation to £2,150 and £33,300 respectively. The taxable bands are uprated each year by indexation unless legislation is passed to override this. A statutory instrument – the Income Tax (Indexation) Order 2006 – has been laid today to give effect to the indexation increases.

From 6 April 2006 the new simplified pensions tax regime comes into effect. This means that the pension schemes earnings cap ceases to exist. From April 2006 there will be two controls on an individual's tax-relieved pension savings: the Annual Allowance (starting at £215,000 for 2006-07) and the Lifetime Allowance (starting at £1,500,000 for 2006-07).

National insurance contribution (NIC) rates and thresholds for 2006-07 were announced in the 2005 Pre-Budget Report. The starting point for employers’, employees’ and self-employed NICs in 2006-07 will increase in line with inflation to £97 per week. NICs are not paid on earnings or profits below this amount. The upper earnings and profits limits for NICs will increase from April 2006 in line with inflation from £630 to £645 per week (£33,540 per year). For the self-employed, the rate of Class 2 contributions will be frozen at £2.10 per week.

Every husband, wife, civil partner and child has his or her own £8,800 annual exempt amount.

The amount chargeable to CGT is added to the individual’s income liable to income tax and treated as the top part of that total. For 2006-2007, CGT up to the starting rate limit will be charged at 10 per cent, between the starting rate and basic rate limits at 20 per cent, and above the basic rate limit at 40 per cent.

As announced in Budget 2005, the inheritance tax threshold is increased by more than statutory indexation to £285,000 for the tax year 2006-07. The value of estates above the threshold is taxed at 40 per cent. The estimated number of taxpaying estates in 2006-07 will be about 37,000 - this is around 6 in 100 deaths. The threshold will be £300,000 in 2007-08. To continue to provide a fair and targeted system, with certainty for families, the Government will now increase the threshold by more than expected statutory indexation for the remainder of the Parliament, to £312,000 in 2008-09 and £325,000 in 2009-10.

The corporation tax main rate remains at 30 per cent. As announced in the 2005 Pre-Budget Report, the non-corporate distribution and starting rates will be replaced with a new single banding for small companies set at the existing small companies’ rate. The small companies’ rate will therefore apply to companies with taxable profits between £0 and £300,000, and will be 19 per cent in 2006-07. The corporation tax main rate for 2007-08 will also be 30 per cent.

Marginal relief eases the transition from the small companies’ rate to the main rate for companies with profits between £300,000 and £1,500,000. The fraction used in the calculation of this marginal relief will be 11/400.

The profits limit may be reduced for a company that is part of a group or has associated companies. The small companies’ rate and marginal relief do not apply to close investment holding properties.

As announced in the Pre-Budget Report, from 6 April 2006, the child element of the Child Tax Credit will be increased in line with average earnings. In addition, the disabled child elements of Child Tax Credit will be uprated in line with inflation. The elements of Working Tax Credit will also rise in line with inflation.

The child element of Child Tax Credit will increase at least in line with average earnings up to and including 2009-10.

The disregard in tax credits for increases in income between one tax year and the next rises from £2,500 to £25,000 from April 2006.

The rates of Child Benefit and the Guardian’s Allowance will rise in line with inflation, except for the lone parent rate, which remains frozen, from 11 April 2006.

The maximum eligible childcare costs remain at £175 per week for families with one child and £300 per week for those with two or more children. The percentage of eligible childcare costs covered increases from 70 per cent in 2005-06, to 80 per cent in 2006-07.

The Chancellor announced today that the starting threshold for residential stamp duty is increased to £125,000 from 23 March 2006. Other rates and thresholds remain unchanged, including the £150,000 residential threshold in the 2,000 Enterprise Areas.

From 6pm on 22 March 2006, tobacco duty rates will rise in line with inflation, to maintain the real price of tobacco.

From midnight on 26 March 2006, duties on beer and wine will increase in line with inflation. Duties on spirits, cider and sparkling wine will not change.

It is the Government’s policy that fuel duty rates should rise each year at least in line with inflation as the UK seeks to meet its targets of reducing polluting emissions and funding public services.

In Budget 2005, the Government announced an inflation-based increase in fuel duty rates to take effect from 1 September. In July 2005, the Government announced that, because of the continuing volatility in the oil market, the increase would not go ahead. At the 2005 Pre-Budget Report, with continuing

market volatility, the Government announced a continuation of the freeze on main fuel duty rates. Budget 2006 announces an inflation based increase in main fuel duties for 2006-07 but because of continuing oil market volatility the changes in rates will be deferred until 1 September 2006.

The duty differentials for biofuels will continue until 2008-09, consistent with the Government’s alternative fuels framework.

To further strengthen environmental incentives, the Government announces the introduction of a new higher band of Graduated VED (band G) for the most polluting new vehicles (those above 225g of CO2 per kilometre) registered after 22 March 2006, set at £210 for petrol cars, and the reduction of the VED rates for small number if cars with the very lowest carbon emission (band A) to £0 to assist the development of the low carbon car market.

VED rates will also be reduced for bands B and C by £35 and £5; frozen for bands D and E; and increased by £25 for band F. Rates for pre-2001 registered cars and light goods vehicles in the lower band will be frozen with the higher band increased by £5.

Fifty per cent of vehicles will see their VED frozen or reduced.

Further information and all published documents relating to Budget 2006 may be found on the Internet at the following addresses:

HM Treasury: www.hm-treasury.gov.uk