CHANGES in the levels at which people pay tax will lead to tax cuts for 29 million, across the UK, according to the chancellor.
The changes will mean a tax cut of around £82 on average for more than 700,000 people in Northern Ireland while 15,000 will no longer have to pay any tax at all.
George Osborne announced he would raise the point at which people start paying income tax to £11,000 next year and increased the bar before people start getting hit by the 40p rate.
George Osborne labelled the measures a "down payment" on his pledge to increase the personal allowance to £12,500 and the higher rate threshold to £50,000.
Raising the higher rate threshold from £42,385 to £43,000 next year will be worth £142 to a typical 40p taxpayer, the Treasury said.
The personal allowance - the amount you can earn before paying income tax - increased by more than 60 per cent under the coalition government to £10,600 this year and was due to rise to £10,800 in April 2016.
But Mr Osborne told MPs it would now be £11,000 as "the first major step to delivering our promise".
"That's £11,000 you can earn before paying any income tax at all - boosting wages by over £900 in total - and a down payment on our goal of reaching £12,500," he said.
The change means that a basic rate taxpayer will be £80 better off than in 2015-16 and paying £905 less in tax than in 2010.
The government will legislate to ensure that once the personal allowance has reached £12,500 it will always be set at a level so someone working 30 hours a week at the minimum wage does not pay income tax.
The 40p rate currently stands at £42,385 and in his March coalition government budget the chancellor said it would increase to £42,700 next year.
Mr Osborne used his first Tory Budget to go further, raising the threshold to £43,000 next year.
"It marks a strong start to our commitment to raise the threshold to £50,000," he said.
"And it will lift 130,000 people out of the higher rate of income tax altogether."
The Budget document said: "A typical higher rate taxpayer will benefit by £142 in 2016-17, and will be £818 better off compared to 2010."
Mr Osborne told MPs the measures meant "29 million people paying less tax" and were "a down payment for a country on the up".
But the Chancellor disappointed some on his own benches who had called for him to cut or scrap the 45p top rate of income tax.
