The British government has rolled out a buffet of tax cuts as it hopes to win over voters ahead of the tightest election in generations. The Finance Minister hailed the new budget as "one more step" towards prosperity.
The Conservative finance minister George Osborne on Wednesday announced a series of pre-election gifts to voters as he presented his final budget before Brits head to the polls on May 7 in a national election that is too close to call.
In his last budget statement to a characteristically raucous House of Commons, the Chancellor of the Exchequer painted the looming election as a "critical choice" between economic chaos or success.
During his hour-long speech, he praised Prime Minister David Cameron's cabinet for saving the economy, claiming that Britain was "walking tall again" after five years of budgetary abstinence.
Osborne said this was borne out by the Office for Budget Responsibility, which on Wednesday raised its GDP growth forecast from 2.4 to 2.5 percent this year, followed by a 2.3-percent expansion in 2016 and 2017.
What's in the budget?
Presenting his new spending plan, Osborne appeared to proclaim austerity dead and buried.
Among the measures meant to spur economic growth, the Treasury chief announced tax cuts on beer, cider and whisky. He also said the government would top up deposits for first-time home buyers, in addition to a 1,000-pound (1,380 euros, $1,470) tax-free allowance on savings.
The budget also includes freezing fuel duties, as well as a 1.3-billion-pound support package meant to prop up the North Sea oil industry amid fears that the collapse in oil prices could trigger massive layoffs across the sector.
Osborne said these giveaways were more than offset by a levy on banks and cracking down on tax evaders - a move he predicted would raise some 4 billion pounds.
"This is the budget that takes Britain one more step on the road from austerity to prosperity," he boasted.
Financial charm offensive
The pre-election push comes as the opposition Labour party has made rising inequality a centerpiece of their election campaign. And the rivals were quick to blast the plan as a populist ploy.
"This is the budget that can't be believed," Labour leader Ed Miliband said.
A recent poll showed the two rivals virtually neck-and-neck, with Labor ahead by a nose.
A clear majority of voters say they want more redistribution of wealth. According to YouGov, 56 percent of respondents said they wanted "more," with 26 percent saying "much more" and just 9 percent saying "less." The same poll showed nearly three-fourths, 71 percent, favoring a higher minimum wage and 54 percent saying they want to see tax hikes for the country's top earners.
Responding to critics calling him the "austerity Chancellor," Osborne countered Wednesday that the average household would have 900 pounds more in their pocket this year than in 2010 as a result of the government's policies.
And the latest figures could prove a last-minute boost for the Conservatives. Britain's deficit, currently expected to reach 4 percent of GDP in 2015/2016, is forecast to turn into a 0.2-percent surplus by 2018/2019.
pad/uhe (AP, AFP, Reuters)