Most first-time home buyers in Northern Ireland will be exempted from stamp duty thanks to measures announced in yesterday's British budget.

Chancellor Gordon Brown raised the threshold for the 1 per cent levy from £60,000 (€86,000) to £120,000, well past the £100,000 limit many had forecast.

While the move was criticised as insufficient in Britain where property prices are significantly higher, the new rate means the majority of Northern buyers entering the market will not have to pay the duty.

The average price of a home in the North is currently just over £100,000 with the most expensive properties in the greater Belfast area.

The duty will now be levied at 1 per cent between £120,000 and £250,000, rising to 3 per cent on property purchases up to £500,000 and 4 per cent thereafter.

Each tax rate is levied on the entire purchase, not the amount over and above the limit.

Farmers' representatives in the North criticised the Chancellor's decision to increase the duty payable on tax-rebated or "red" diesel.

The measure was announced during Mr Brown's speech as part of the plan to move against illegal use of farm diesel by ordinary motorists.

The British Treasury believes a squeezing of the differential in rates between fully taxed and "red" diesel in the North will reduce the fraud incentive.

Farmers' organisations claimed the move lacked logic and would only force an increase on the unit costs faced by agricultural producers.

Both Sinn Féin and the SDLP criticised aspects of Mr Brown's budget.

Mr Francie Molloy, the Sinn Féin spokesman on finance said: "While there is a feel-good myth permeating almost everything New Labour touches the reality is that there are rising levels of poverty that have become entrenched. The majority of employment growth is concentrated in part-time, low skill, low paid and insecure service sector jobs. This is not dealing with the ever widening poverty gap, it is reinforcing it."

SDLP representatives welcomed aspects of the budget but claimed they were on too small a scale.

Deputy leader Alasdair McDonnell welcomed the additional £88 million for government departments, but feared that it will not be enough to tackle need in the North.