Key features at a glance of the Isle of Man Budget include:
- Government has achieved its aim of a rebalanced revenue budget, with provision for a £2m surplus.
- A reduction in gross spending in real terms (after inflation) by over £9m or 1%.
- Reintroduction of loan interest charged to Departments, to replenish the Capital Fund. Capital programme of £78m includes construction and engineering work worth £60m, £3m or 6% more than the previous year.
- £2m increase to the Health Inspection Fund to help fund additional resources and projects arising from reviews of Noble's Hospital.
- Creation of a £8.2m central contingency to offset unfunded inflationary and other contingency risk impacts to ease pressure on internal reserves.
- A substantial (82.7%) increase in the Carer's Allowance paid to those who cannot work because they are providing full-time care to a severely disabled person. This is going up from £61.35 to £112.10 per week and will benefit around 320 carers at an additional cost of about £850,000 a year.
- A new National Insurance 'holiday' scheme for employers taking on a person who has been long-term unemployed, long-term sick or recently released from prison
- The 'tax cap', maximum individual income tax liability, to be increased from £120,000 to £125,000 for new entrants to the scheme. Mr Teare said the scheme would generate a direct economic benefit in the region of £125m over the next five years.
- An increase from 10% to 20% in the income tax rate paid by companies on income from local land and property, expected to raise an additional £3m per year.
- Personal Allowance Credit to be reduced from £500 to £400 and to be restricted to the elderly or disabled with a taxable income of £9,500 or less. The Minister explained that PAC was still a potential disincentive to paid employment.
- Income thresholds for means-tested entitlement to child benefit to be reduced by £10,000, saving around £1m a year. Families with annual incomes under £50,000 will be entitled to full benefit; reduced benefit will be payable to those on between £50,000 and £80,000; and families with income above £80,000 a year will no longer be entitled to child benefit.
Further information from:
David Catlow, Interim Chief Financial Officer
Isle of Man
+44 1624 685666