§ I said that we would maintain the basic and top rates of tax for this Parliament. As is usual, we will increase all income tax allowances, income limits and tax thresholds in line with inflation.
§ I turn now to this year's Budget decision on mortgage tax relief. I can tell the House that I have decided in this Budget not to make any further change in the rate, or to make any change to stamp duty on property below £250,000. For property sales above £250,000, stamp duty will be raised to 2 per cent. from next Tuesday, and to 3 per cent. on property sales above half a million pounds—a change which leaves 98 per cent. of house transactions unaffected.
§ I also had a decision to make on inheritance tax. Many have put to me the case this year for freezing or even lowering the threshold. I have decided to do neither of those things. This year, I will raise the threshold for inheritance tax by £8,000. Under this Government, there will be no inheritance tax to pay on estates below £223,000: 97 per cent. of estates will not have to pay inheritance tax. Rules on inheritance tax concerning chattels will, however, be tightened to ensure proper access.
§ I also want to improve access to our nation's museums and galleries. I have therefore decided that extra money will be made available to help museums and galleries that do not currently charge for admission, to maintain free admission in the coming year.
§ As promised in the last Budget, 1 will raise revenue over the next three years by closing a number of loopholes left by the last Government, including those relating to 1111 offshore trusts. The measures that we shall take to deal with such loopholes will raise a total of £1.5 billion over three years. Next month, we will publish and consult on draft legislation for a general anti-avoidance rule for direct taxes.
§ From 1 January next year, alcohol duties will be uprated in the normal way, by 1p on a pint of beer and 4p on a bottle of wine. For a bottle of spirits, the duty will be frozen at its current level. I shall be taking action to clamp down on smuggling and fraud.
§ On tobacco, in line with the commitment that I announced last year, the excise duty will rise by 5 per cent. above inflation. From 1 December, the tax on a packet of 20 cigarettes will rise by just over 20p. Details of those duty changes, together with details of changes to certain gambling duties, are published this afternoon.
§ I have had many Budget representations, including many widely publicised campaigns, pressing for new tax reliefs. I have decided that there is a case for one new tax relief, for giving. I want British citizens to be able to contribute more to poverty relief and education through charitable work in the developing countries. For every £100 that a British citizen donates, the Government—under the proposals that I have announced today—will contribute up to £40.
§ I want the millennium to be remembered, not just nationally but internationally, for the redemption of debt and the reduction of world poverty. This new tax relief will allow individuals to make their contribution to the reduction of world poverty.