tax rate of 11% on properties worth more than two million pound. i also intend to deal with the unlimited use of income tax release. let's be clear, most rich people pay a lot of tax. it is also right that we have tax relieves that promote investments, support charitable giving and reflect genuine business laws. but it can't be right that some people make unlimited use of these relieves year after year. everyone in this country and particularly those with the highest incomes should contribute a fair share to the exchequer. some relieves like the enterprise investment scheme and pension relief are already capped. i do not intend to make significant changes to pensions relief in this budget. but to make sure that those on the highest can contribute a fair share, i am introducing a new cap on those relieves that are currently incapped.

from next year anyone seeking to claim r50,000 pounds of relief in one year will have a cap set at 25% of their income. we've capped benefits. now it is right to cap tax relieves, too. mr. deputy speaker, that brings me to the rates of income tax and the additional rate of 50 pence. this tax rate is the highest in the g-20. it is higher not just than the tax rate of america, but also a major european countries like france, italy and germany. it is widely acknowledged by business organizations and international observers as harming the british economy. like the previous chancellor who introduced it, i've always said it was temporary. i also said three years ago that i would not be prepared to reduce it while we were asking the whole public sector to

accept a pay freeze. a 50 p tax rate will all the damage it does to britain's competitiveness can only be justified if it raises significant sums of money. in last year's budget, i asked her majesty's revenue and customs to look at the evidence and look at the self-assessment tax reveepts that have come in since this january. i'm publishing the report today. and what it reveals is that the 50 p tax rate has caused massive distortions. hmrc find that an astonishing 16 billion pound of income was deliberately shifted into the previous tax year at a cost to the taxpayer of one billion pounds. something that the previous government's figures made no allowance for whatsoever. self-assessment receipts this year will we low forecast by some 3.6 billion while other tax receipts have held up.

the increase from 40 p to 50 p raised just 1/3 of the three billion pounds we were told it will raise. of course -- of course, mr. deputy speaker, the previous government initially proposed the rates of 45 pence and then increased that to a pence. let me tell the house what her majesty's revenue and customs say the difference between 40 p and 50 p. their figures -- i'm come on to that. don't you worry. their figures tell the story. the direct cost is only 100 million pounds a year. in other words, it raises at most a fraction of what we were told and may raise nothing at all. from last year the top rate of

tax will be 45 pence. no chancellor -- no chancellor can justify a tax rate that damages our economy -- >> order. we're nearly coming to tend. i want the same respect to be given to the leader of the opposition. please. >> mr. deputy speaker, no chancellor can justify a tax rate that damages our economy and raises next to nothing. it is as simple as that. and thanks to the other new taxes on the rich, i've announced today we'll be getting five times more money each and every year from the wealthiest in our society. so the richest pay more. >> you're getting very excited at the back. i'm sure you want to calm down. it's not good for your health. >> so the richest pay more, the economy benefits, britain is

competitive again. now quite a few members opposite have said that the hmrc report is not enough and that the office for budget responsibility should pass judgment. they have. because these days the direct costing the treasury applies to every budget measure is independently assessed and certified by the obr. and unlike the previous government they also assess the cash flow consequences of stalling. when it comes to the 1 hundred million pound direct cost of the measure the obr say this, we believe that this is a reasonable and central estimate. and they also assess as reasonable the estimate that the new taxes i've introduced on the rich today directly raise five times that amount. and is half a billion pounds -- half a billion pounds we can now use to help people on lower and

middle incomes keep more of their own earnings. mr. deputy speaker, in the spending review, we took the difficult decision to remove child benefit from families with a high rate of taxpayer. i said then that i simply could not justify asking those earning 15 or 30,000 pounds a year to go on paying child benefit to those earning 80,000 or 100,000. i stand by that principal. all sections of society must make a contribution to dealing with the deficit. without this measure we wouldn't get the job done. but i said i wanted to do this in a way that is fair and that does not involve setting up some new means tested tax credit system for millions of families. and i said i would set out exactly how this measure would be implemented in this budget. we want to avoid a measure that means people lose all their child benefit when they earn a pound more. i can confirm that instead of

withdrawing child benefit all at once than more than the high rate threshold. the benefit would be withdrawn when someone in the household as more than 50,000 pounds and the withdrawal will be gradual 1% of child benefit for every extra 100 pounds over 50,000. there's no cliff edge and only those with an income of more than 60,000 pounds lose all of their benefits. 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. now we can afford to implement the child benefit policy in this way because instead of extending the full benefit this budget's increased the personal answer to all high rate tax payers as we did last year we will pass on a quarter of the benefit to high rate tax payers and spend the rest on helping families with

children towards the bottom of the higher rate band. mr. deputy speaker, that brings me on to the personal allowance and the central goal of this budget which is the support working families. this coalition government believes that the best way to support working people on the lowest incomes is to take them out of tax altogether. the best way of getting money directly into the pockets of working families on middle incomes is to increase the amount of that earnings they can keep before they pay tax. that is why this government has set itself the goal of raising the personal tax free allowance to 10,000 pounds. and we promised real increases every year to reach that. in my last two budgets we have made great strides forward. last year the personal allowance rose by 1,000 pounds. in two weeks time it will go up by another 630 pound. and together these increases have taken over a million low

paid people out of tax altogether. today mr. deputy speaker i want to go much further and much faster. i am announcing the largest increase in personal allowance. next april that amount will increase by 1,100 pounds. every working person on low or middle incomes will benefit. people will be able to earn up to 902,000 before they have to pay any tax. mr. deputy speaker, millions of working people will be 220 pounds better off every year. that's 170 pounds better off after inflation. because higher rate earners will also benefit 24 million people earning less than 100 pow pounds

a year will gain from this measure. we are in touching distance of the goal of a 10,000 pound personal allowance that we'll all share. i can tell the country that as a result of our budgets people working full time on the minimum wage will have seen their income tax bill cut in half. and this coalition government will have taken two million people, two million of the lowest paid people in our country out of tax altogether. mr. deputy speaker, in the mill of this parliament, in difficult economic times. this coalition government has not settled for a do nothing budget. we have not ducked the difficult choices. we've taken them head on. a competitive top rate attacks. more revenues from those best able to pay. fewer relieves. a tax cut for working people, support for families, low income

earners. tax altogether. alongside it one of the lowest rates in the world. a simpler tax code and a country where citizens know the taxes they are paying and what they are paying it for. we have achieved all this and kept to our deficit plan. let us be resolved no people will strive as the british will strive, no country will adapt as the british will adapt. no country will value those who work as we will value those who work together the british people will share in the effort and share the rewards. this country borrowed its way into trouble now we're going to earn our way out. i commend the house. >> order. order.

order. thank you. provisional collection of taxes must be decided without debate, will the chancellor and exchequer please move forward. the question is pursuant to section five of the provisional collection of taxes of 1968, shall be given to the following motions, a, back products motion number 40. b, alcohol motion number 41. c, amusement machine motion number 47. d, landfill site in scotland motion number 58. e, stamp duty prevention of avoidance of cities et cetera, motion number 65 and f, stamp duty lamp tax raise residential

property where consideration exceeds two million pounds, motion number six. g, stamp duty land tax higher rate for certain acquisitions companies et cetera, motion number 67. as many of that opinion say aye. i shall call upon to move a motion entitled to the member of the law. it is a motion that the debate will take place today and on succeeding days. the remaining motions will be put at the end of the budget day on the 26th of march. will the chancellor please move the law motion. it's moved. the question is exhibit tants to amend the law with respect to the national debt and public revenue and further provision with connect to the finance. this resolution does not with respect to the value added tax.

a, zero rating a supply acquisition of importation. b, the refunding amount of tax. c, friendly relief other than relief that's won. so far it's politicsable to goods that apply to every description. so far it is politicsable to services services of every description. i know called the leader of the opposition, the right honorable edward millband. >> mr. deputy speaker, the chancellor spoke for an hour. but one of his phrases was missing. there was one thing he didn't say. today marks the end of we're all in it together. because after today's budget -- >> order. i don't think we need you to lead th cheerleader.

i expect the same respect to be given to the opposition. >> after today's budget millions will be paying more while millionaires pay less. a year ago the chancellor said in his budget speech and i quote -- now would not be the right time to remove the a p tax rate. when we are asking others in our society -- is he saying he didn't say it? he said now would not be the right time to remove the a p tax rate when we are asking others in our society on much lower incomes to make sacrifices. that is exactly what he has done. tax credit cut, child benefit taken away. fuel duty rising and what has he chosen to make his parity, for britain's millionaires a massive income tax cut each and every

year. mr. deputy speaker, the fairness test for this budget was whether the chancellor used every penny he could to help middle income families in a squeeze. he has failed that test. anyone who listens to the chancellor will be asking the same question, what planet are he and the prime minister living on. a businesses going bust every day. a cost of living crisis for families. they promised change but things have got worse not better. what did he promise us? last year's budget? he said he would and i quote mr. deputy speaker, put fuel in the tank of the british economy? he promised growth of 2.5% in 2012. today he comes to the house and tells us it will be just north .8%. growth down last year, growth down next year. every time he comes to the house

he offers a different excuse but the reality is his plan has failed. last year he told us unemployment would peak in 2011. what has he delivered. we're into 2012 and unemployment is rising month upon month upon month. his plan has failed. and he promised us also, mr. deputy speaker last year the deficit would be gone by the end of the parliament. but today he admits he's borrowing over 150 billion more than he said he would. his plan has failed. and in the face of failure, what does he offer? not a change in economic strategy. not a guarantee of jobs for the young unemployed. not targeting every penny he could at working families. no. we know the driving ambition of this budget for the chancellor was to deliver a tax cut for people earning over 150,000

pounds a year. there are 30 million tax payers in this country. this will do absolutely nothing for 29,700,000 of them. how can the priority for our country be an income tax cut for the richest 1% and the time for the squeeze middle are facing rising petrol price, higher energy bills, tax credits and child benefit being cut. think of what he could have done with the money. he could have reversed his tax credit. he could have done something for pensioners. in fact, i think there's a tax drive for pensioners hidden in the detail of this budget. he could have done more to undo the damage on child benefit. he claims he can't afford it. let me tell the chancellor, every time in the future he tries to justify an unfair decision by saying times are tough, we'll remind him he is the man who chose to spend

hundreds of millions of pounds on those who need it least. wrong choices. wrong priority. wrong values. oit of touch. same old toris. let's count his claims on stamp duty. there are 300,000 people benefitting each and every year from his top rate tax cut. there are 4,000 houses sold each year for more than two million pounds. so 99% of those who gain from his millionaire's tax cut will be totally unaffected by the rise in stamp. and they will get a massive windfall from that chancellor. mr. deputy speaker, the chancellor didn't tell us what this meant in pounds and pence. the prime minister thinks the chancellor did say how much each

person is getting as a result. he didn't. he didn't. he didn't. i'm going to tell him how much. there are 14, there are 14,000 people earning over a million pounds in britain. the chancellor's decision today means each of them get a tax cut. not 1,000 pounds, not 5,000 pounds. not 10,000 pounds ark tax cut of over 40,000 pounds. >> order, it's not good for the opposition not to allow the leader of the opposition to speak. >> not just this year, but for every year. mr. deputy speaker, whops to those families who earn in one year half of what the chancellor has so casually given away to the richest in the last hour? families on 20,000 a year, a

nurse or a driver. even after the personal allowance changed, they're not going to be better off, they're going to be worse off. put aside all the tax rises that have happened. from this april alone there will be a further 253 pounds a year worse off. all he's doing for ordinary families is giving with one hand and taking far more away with the others. it's a millionaire's budget that squeezes the middle. wrong choice. wrong priority. wrong values out of touch same old toris. under his tax cut, a banker earning 5 million pound will get an extra 240,000 pounds a year. let's call this what it really is. the government's very own banker's bonus. now presumably mr. deputy speaker, he wants us to believe that a 240,000 pound tax cut is necessary to make them work harder, the bankers.

it's one rule for them and it's another rule for everyone else. because this april the chancellor will be telling a family working for 16 hours on the minimum wage if they don't work for hours they will lose nearly 4,000 pounds in tax credits. it tells you everything you need to know about the values of the chancellor and prime minister. the poor will only work harder by making them poorer. the rich will work harder by making them richer. wrong choice. wrong values. wrong priority, same old toris. what the is chons lohr's priority? the massive tax cut for his christmas card list. the chancellor talked about tax transparency. let's have some. let's -- let's have some. >> i think you need to calm down. it's not good for you.

it's not good for the house. hands up in the benefit if you're going to benefit from the income tax cut. come on. come on. >> order. order. >> i have looked to you twice, i don't want to continue to look. i think we need a little bit of silence from you, i not, you might better off leaving the chamber. i think we understand. >> he's the man who said sunlight is the best din infolk tant. here's the challenge. nod if you get a benefit from it or shake your head if you do not. come on. come on. come on. come on. come on, we've got plenty of

time. both sides of the house will come to order. the leader of the opposition will be heard in the same way that the courtesy was given to the chancellor. i don't want to have to rule because we will have to get further. it's only right that the country should hear what the opposition's got to say. order. i don't need any examples from you. i've got one thing to say to him, let sunshine win the day. but i hear -- but i hear it's good -- i hear it's good news for him mr. deputy speaker, now he's going to be able to buy his own horse.

>> order. we will not have any clapping in the chamber. seriously, i don't think it's -- this house set its course and its reputation any en we can't hear the leader of the opposition. it's both sides to give court >> what about the hapless accomplice, the deputy prime minister. only the liberal democrats can be dumb enough to think that a george os born budget is a robin hood budget. calamity strikes again. 4 is what he said a few months ago, no ifs, buts, i do not believe that the priority is to give a tax cut to a tiny, tiny number of people who are much better off than anybody else.ey

the talk, all the briefing the deputy prime minister has done what he's done on every big issue. from tuition fees to the betrayal on the nhs. he's rolled over and said yes prime minister. for ordinary family it's not working. r and too far. what did the chancellor say? what did the chancellor say? last august about america's more balanced deficit reduction plan? he says those who spent the whole of the past year telling us to follow the american example ne question, why has the u.s. economy grown more slowly than the uk? mr. deputy speaker the numbers are in. the chancellor is plain wrong.

the u.s. economy grew 1.7% last year, twice the rate of ours. this government has run out of excuses. it's their mistakes damaging our future. it's the failure of their plan. today we heard about more schemes from the chancellor. but mr. deputy speak, why should ebl it. every scheme so far has failed. he told us in the june budget it would help 400,000 firms. he's missed his target by 9 %. the chancellor's plan has failed. what about the center piece of last year's budget? it's easy to forget now, it was called the budget for growth. this one is my favorite. it's the business growth fund. the business growth fund. six regional offices open and how many businesses benefitting?

six. one for each office. the chancellor's plan has failed. we needed a plan for growth that will work. we needed a guarantee on used jobs. we needed a british investment bank to help slow business. on growth, on jobs on how we pay our way in the world this chancellor has failed. on the proposed film and tax relief, let me say this, it's great to support great british success stories. a tale and indeed wallace and gromit. it's also important mr. deputy speaker to support downs and abbey. a tale of a group of out of touch millionaires who act like they're born to rule but turn out not to be very good at it. mr. deputy speaker, mr. deputy

speaker, it sounds familiar, doesn't it. we all know it's a costume drama. they think it's a fly on the wall documentary. mr. deputy speaker, this budget will be remembered for his failure on growth and jobs and the top rate tax cut. this isn't just a bad policy or a misjudgment. it destroys the claim the prime minister made. it destroys the claim the prime minister made about who he was and what he believed. what did he personally say in his aims and values document sent out to every conservative party member? the right test for our policies is how they help the disadvantaged in society not the rich. it was called built to last. that was his test. a test this budget failed spectacularly. it's the death nail of his project. his compassi he and the chons lar have shown their true colors. they promised change. they failed on