Rachel Reeves has announced a significant £26 billion annual increase in taxes in a Budget that was leaked just before its official release.
The Chancellor revealed a new mansion tax aimed at homes valued over £2 million and confirmed the removal of the two-child benefit limit, a decision long advocated for by anti-poverty activists.
Amid controversy, Reeves confirmed a freeze on income tax thresholds, impacting over 1.5 million workers. Additionally, new levies will be imposed on the gambling industry, while fuel duty will remain unchanged until the following year.
Addressing the lively House of Commons, Reeves defended her choices by stating, “These are my decisions, the correct ones for a fairer, stronger, and more secure Britain.”
The Mirror now highlights the key points from the eagerly anticipated Budget presented by the Chancellor.
A new tax on properties exceeding £2 million was revealed, anticipated to affect between 100,000 and 200,000 residences. The tax is projected to generate approximately £400 million annually for the Treasury.
Furthermore, a “high value council tax surcharge” will be imposed on properties surpassing £2 million, with varying charges based on property value bands.
In a significant move, the Chancellor scrapped the controversial two-child benefit limit, a policy criticized for exacerbating child poverty since its introduction in 2017.
Reeves also announced the intention to raise £1.1 billion through reforms to gambling taxes, including increasing remote gaming duty rates. These changes are estimated to raise significant revenue by 2029-30.
Rail passengers were pleased to learn about the first rail fare freeze in three decades, providing savings of £600 million in the upcoming fiscal year. This decision was welcomed after years of consistent fare increases.
Income tax thresholds will remain frozen for an additional two years until 2030, potentially pushing more individuals into higher tax brackets as their incomes rise.
A new mileage-based charge on electric and plug-in hybrid cars will be implemented from April 2028, expected to generate £1.4 billion for the Treasury.
Reeves promised a £150 reduction in average household energy bills starting in April, emphasizing a commitment to easing the cost of living for working families.
Pensioners are set to receive a boost of around £550 annually as the state pension increases from April next year, linked to average earnings growth.
The Chancellor will maintain the 5p fuel duty cut until September 2026, followed by a gradual reversal as outlined by the Office for Budget Responsibility.
Reeves confirmed pay raises for approximately 2.7 million workers from April, with the National Living Wage set to rise to £12.71 per hour for individuals over 21 years old.
Additionally, national insurance contributions will now apply to salary-sacrificed pension contributions, estimated to raise £4.7 billion annually.
To combat obesity and safeguard children’s health, the tax on sugary drinks will be extended by narrowing the sugar threshold under the Soft Drinks Industry Levy.
The Budget also includes adjustments to the ISA limits, with a reduction for younger savers but exemptions for over-65s.
A new tax on overnight stays in accommodations, including Airbnbs, will be introduced, with local leaders having discretion over the additional charge.
Reeves pledged a £300 million investment in NHS technology to enhance patient services and establish 250 new neighborhood health centers by 2030.
Funding for the long-awaited Lower Thames Crossing and other transport infrastructure projects was confirmed, underscoring the government’s commitment to regional development.
The Chancellor’s Budget outlines a comprehensive strategy to address economic challenges while prioritizing key sectors and initiatives for national growth and welfare.