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Budget 2016: Sugary drinks hit as...

Osborne ‘blazes a trail’ with tax cuts and help for savers

Osborne BudgetChancellor George Osborne today announced a surprise cut in corporation tax and slashed taxes on the struggling oil and gas industry.

He froze whisky duty, scrapped class two national insurance contributions for three million self-employed, and froze fuel duty for a sixth year.

He also freed thousands of businesses in England from the burden of business rates.

In a Budget full of surprises he unveiled a new Lifetime ISA to encourage the young to save. For every £4 they save the government will provide £1, up to £4,000 per year.

The income tax threshold will rise to £11,500 and the higher rate threshold to £45,000, worth £400 a year. These were the last rates set by a UK chancellor and will be reviewed by the Scottish government under its new tax powers.

Corporation tax will fall to 17% in April 2020 while 600,000 small firms will no longer pay rates.

The decision on business rates will put enormous pressure on the Scottish Government to follow suit or risk putting businesses north of the border at a huge disadvantage.

Mr Osborne said his decision meant Britain was “blazing a trail, let the rest of the world catch up.”

He cut the supplementary charge on oil and gas to 10% and abolished the petroleum revenue tax.

“We are only able to do this because of the broad shoulders of the United Kingdom. None of this would have been possible if in just eight days time Scotland had broken away,” he said.

He confirmed that talks were under way on a City Deal for Edinburgh.

A new sugar tax on the soft drinks industry is to be introduced in two years’ time, raising £520m which will be spent on primary school sport.

The levy will be calculated on levels of sugar in sweetened drinks produced and imported. Pure fruit juice and milk-based drinks will be excluded.

Shares in AG Barr fell sharply at one point, down by 5%, but recovered to close down 2.4%.

The move won the praise of celebrity chef and anti-sugar campaigner Jamie Oliver.

> See Budget2016  for full breakdown and reaction:

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