UK Chancellor Alistair Darling announced a raise in tax rate from 40 to 45 percent for 150K+ earners. Personal allowances for this year were made permanent, meaning that basic rate taxpayers will pay £145 less tax in 2009/2010.
The VAT rate drops temporarily to 15% until January 2010, in an effort to reduce goods prices. Economists speculate this VAT cut will go to firm profit and will not be passed on to consumers.
National insurance also goes up 0.5 percent for both employers and employees. The difference is expected to be compensated with higher allowance rates.