Would Darling have rather used the money for something else? 4 25pm: Darling said he would have wanted to raise allowances anyway.
The Tories have relinquished their totemic pledge to raise the threshold for inheritance tax, bowing to the Lib Dem desire to lighten taxes on less wealthy workers instead by raising allowances.
He confirmed widely trailed plans to raise personal allowances for basic rate taxpayers by £1,000 to £7,475 from next April, taking 880,000 of the lowest paid out of income tax altogether and saving 23 million lower rate taxpayers up to £170 a year.
However, that has to be offset by the £1bn cost of raising tax allowances for the over-65s, and the £2.3bn cost of raising the child tax credit and working tax credit thresholds – all of which leaves the Treasury with a £3.7bn net gain.
By carefully targeting the extra £1.7bn spent on the working and child tax credits and by raising tax allowances for the over-65s, the IFS said the chancellor had minimised the number of low-income losers.
Ministers want to move towards a single tax allowance for those of working age and the retired, having set a goal of raising tax allowances for under-65s to £10,000 by 2015.
But last month, he also raised heating oil allowances for public workers.
After meeting union leaders recently, Mr Sarkozy tried to head off more conflict by offering to raise family allowances, reduce income tax for the lowest-paid and boost unemployment insurance.
Raise its allowance for doubtful accounts between 1997 and 1998 by 6%, while its accounts receivable grew 36%.
The changes announced in the 2008 budget do, however, also include the raising of tax allowances for the over-65s, as well as the income thresholds for the withdrawal of working tax credits and child tax credits.
