Everything in Rachel Reeves budget leak – tax rise and budget change
[ad_1]
An ‘unprecedented’ leak has seen key measures from the Budget accidentally published way ahead of Chancellor’s speech
- Income Tax and NI freeze extended : The biggest proposed tax raid involves extending the freeze on Income Tax and National Insurance (NI) thresholds until 2030/31, a measure set to raise an estimated £8 billion. This means that more workers will be pulled into higher tax bands as their wages rise over the next few years.
- Pensions and investment hikes: Plans are in place to charge National Insurance on pension contributions made through salary sacrifice schemes, expected to bring in £4.7 billion. Separately, taxes on investment income, including dividends, property, and savings, are scheduled to climb by a further two percentage points.
- New taxes on driving and property : A controversial ‘pay-per-mile’ road scheme is outlined in the documents, which is projected to generate £1.4 billion in revenue. Furthermore, local authority funds will be boosted by a new council tax surcharge levied on properties valued at over £2 million.
- Downgraded economic outlook : The OBR has delivered a cautious economic forecast, downgrading the UK’s economic growth predictions for the next four years. Growth rates across 2026 to 2029 are now consistently projected to be lower than the figures provided in the previous March forecast.
- Key spending and debt projections : A major spending commitment revealed is the removal of the two-child benefit cap, a policy set to cost £3 billion by 2029-30. Despite the substantial tax hikes, public debt is forecast to continue rising, moving from 95% of GDP to an expected peak of 96.1% by the end of the decade.
- Fuel duty and treasury headroom : The existing temporary 5p fuel duty cut will be maintained until September 2026 before being phased out gradually. Meanwhile, the Treasury’s day-to-day spending headroom (fiscal space) is projected to widen significantly, increasing by £12 billion to reach £22 billion in 2029-30.
[ad_2]
Source link