Bygone budgets: March 1981

Geoffrey Howe's second budget came in difficult economic circumstances. Total output had fallen by 2.5%, with manufacturing down by 9%, in the last year, and unemployment up by almost a million in 12 months. Conservative MPs openly criticised the budget, with several walking out of the Commons while the chancellor spoke. Opposition leader Michael Foot presciently remarked: "This is a budget to produce over three million unemployed".

Income tax
No increase in income tax, personal allowances or in tax rate thresholds, which would normally be increased in line with inflation (about 15%). This was, in effect, a significant income tax rise.

Perks
Tax introduced on the perk value of season tickets and credit cards provided by employers. The tax on perk value of company cars also increased.

North Sea oil
New 20% tax which, with changes in petroleum revenue tax would raise nearly £1000m in revenue.

Banks
One-off tax on certain deposits, raising £400m.

Duties
Beer up 4p, spirits up 60p, wine up 12p, 20 cigarettes up 13p. Petrol duty up a massive 20p per gallon.