GEORGE Osborne must tackle the soaring cost of fuel, housing and alcohol in today’s Budget, businesses said last night.

The Chancellor is expected to outline policies including a £1,000 increase to the income tax threshold to £7,475, and lowering the higher tax threshold to £35,000.

Employee contributions for the main rate for national insurance will rise from 11 to 12 per cent while corporation tax is expected to fall from 28 to 27 per cent.

Speculation is rife over whether Mr Osborne will scrap or delay a planned increase in fuel duty.

Margaret Coles, chairman of the Oxfordshire branch of the Federation of Small Businesses, said: “Reversing the planned 1p rise in duty – which when indexed to inflation will actually mean a 5p rise on pump prices – and cutting VAT on fuel duty will be welcome steps.

“But to really stem these volatile prices the Government must introduce a fuel duty stabiliser as it has promised.

“Small firms are under huge pressures – stabilising fuel prices would be a step in the right direction to help small businesses in all sectors grow.”

Hard-pressed publicans are also hoping for some respite from the Chancellor.

Bal Gill, landlord of the Abingdon Arms in Beckley, said: “Beer prices are key. We really do not need an increase there.

“More and more we are dependent on local trade because fuel prices are going up.

“But we don’t want to see the price of a visit to the pub going up again.

“Already we have been hit by increased VAT, business rates, and minimum wages. We cannot afford more beer duty too.”

Glenn Allison, managing director of Witney house building firm Stewart Milne, said the Chancellor must make it easier for people to get mortgages.

He said: “I don’t know how a young first time buyer can find 20 per cent of the price of a home when starting out.”

Some reports yesterday said the Chancellor will tax private jet flights, currently exempt from duty. Oxford Airport spokesman James Dillon-Godfray said: “We are already the most heavily taxed country in Europe for aviation by a huge margin.”

business@oxfordmail.co.uk l How will it affect you? See oxfordmail.co.uk for updates from 12.30pm today and a full report in tomorrow’s Mail