Manx Government Announces 2008 Budget

by Jason Gorringe, Tax-News.com, London

20 February 2008

Isle of Man Treasury Minister, Alan Bell has resisted the temptation to tinker with rates of business and personal taxes in his 2008 budget, announced on 19th February.

The main thrust of new measures announced by Bell in his seventh budget as Manx Treasury Minister were aimed at improving the lot of the low paid, as he unveiled an "unprecedented" GBP6.5 million package of additional support for pensioners and low income groups.

Bell also announced significant new funding for marketing the Island as a base for international business.

The Minister explained that: "I believe that at heart we are an “Island of Opportunity” where prosperity can be built and the sense of community reinforced, through the creation and sharing of wealth. This is a good budget for all our community."

Key features of the 2008 Isle of Man Budget include:

• A GBP6 million increase, to a new total of GBP10 million, for the Marketing Initiatives Fund to boost Government’s promotion of the Island’s economy, plus GBP8 million more over two years for the E-Commerce Fund.
• GBP8 million to establish a new Town and Village Centre Regeneration Fund, initially focused on improving the infrastructure and environment of the centre of Douglas as the Island’s capital.
• A GBP28.2 million or 5.2% increase in net Departmental revenue spending on public services to a new total of GBP566.5 million.
• A 0.1% increase in Government staff numbers the lowest since 1995/96.
• A new GBP3 million Energy Initiatives Fund to help Government cut its fuel bills and carbon emissions.
• Proposals to be published for simpler car and fuel benefits-in-kind system to reflect environmental impact.
• Overseas Aid Budget to be increased 22% to GBP2.2 million, (compared to GBP400,000 in 2002).
• GBP4.3 million more for Education, including GBP2 million to meet rising fees for Island students at UK universities.
• Personal income tax standard rate stays at 10%, with the higher rate remaining at 18%.
• Tax cap on total income tax payable per person remains at GBP100,000 or GBP200,000 per married couple.
• An additional income tax allowance of GBP2,000 for all over-65s, taking another 1,650 pensioners out of the tax net. In 2008/09 half the Island’s retired population will pay no income tax.
• Personal Allowance Credit for those on low incomes to be increased 19% to GBP500 and payable as a flat rate to all recipients - 4,500 people previously on partial credits will now get the full amount.
• Extra help for pensioners on income support which could see some couples GBP1,000 a year better off.
• A gross spending increase of 7.3% for the Department of Health and Social Security – the highest for five years. Provision was made for the introduction of free nursing care on a phased basis, for a new carers bereavement payment, and to build on waiting list initiatives.
  

Recommended