US EditionMore Taxes, Higher Spending: A Closer Look at Britain's New Budget
Tax changes including income threshold freezes and new levies on wealth are forecast to raise £26.1 billion by 2030, supporting welfare and aiming for a budget surplus, the Office for Budget Responsibility said.
- On Wednesday, British Chancellor Rachel Reeves unveiled a budget raising 26.1 billion pounds by 2030 through freezes on income tax thresholds, a mansion tax, and a 2 percentage point rise on certain incomes.
- Reeves framed the package as a bid to shrink borrowing and reach surplus, using nearly 22 billion pounds in fiscal headroom within five years to fund welfare and public services.
- The budget’s ‘fiscal drag’ will bring hundreds of thousands into income tax, with 780,000 more basic-rate and 920,000 higher-rate taxpayers forecast by 2029-2030, according to the Office for Budget Responsibility .
- An OBR publication error occurred two hours before the formal announcement, which Reeves called 'deeply disappointing' and a 'serious error,' while sterling ticked up 0.3% to $1.3213 before settling back. Markets showed limited reaction, with FTSE indices rising about 0.6%.
- Seen as a make-or-break moment for Labour, the budget broke a manifesto pledge and drew sharp Conservative criticism, with Kemi Badenoch calling it "a total humiliation" and advisers saying repeal was critical to Reeves’s survival.
13 Articles
13 Articles
This budget paid the political price up-front, but will the public feel the benefit by the next election?
This week’s budget showed there’s no sugarcoating the economic and fiscal circumstances that we find ourselves in. The country is trapped in a fiscal straitjacket, bound both by the poor decision making of previous governments, and events outside of our control. We shouldn’t make excuses for those who have the privilege of running the country, but nor should we deny the root causes of the current situation either. There are many good reasons why…
Why Rachel Reeves chose a ‘smorgasbord’ of tax tweaks – and the risks involved in that approach
Andrzej Rostek/ShutterstockChancellor Rachel Reeves has delivered her second budget, in which she raised taxes by £26 billion. This will take the UK tax burden to an all-time high of 38% of GDP by 2030-31. But it will also more than double Reeves’ “fiscal headroom” to £22 billion. This fiscal headroom – effectively Reeves’ spending buffer – is up from the previous £9 billion, giving the government more flexibility to increase spending or reduce …
Our welfare bill is ballooning - and our pathetic politicians are to blame
Like every chancellor, Rachel Reeves loves to say she is taking tough decisions and governing in the national interest. Yet, her second Budget was a dismal display: a weak Chancellor in a weak Government attempting to appease her own side to buy more time in power, regardless of the cost to the country. So, there was a headline-grabbing bung on benefits, an array of stealth taxes and some sniping at the rich. The legacy of this short-term tribal…
Rachel Reeves's maneuver introduces £26 billion of new taxes between frozen thresholds, dividends taxes and green jumps. Public spending also grows, while media and oppositions speak of historical staggered .
More taxes, higher spending: A closer look at Britain's new budget
UK Finance Minister Rachel Reeves has announced a new budget that includes more taxes for ordinary workers, but higher government spending on social welfare programmes. The new plan will raise the government's tax take to a post-war high of 38 percent of GDP by 2031, according to the Office for Budget Responsibility (OBR). It will give the government greater room to meet its deficit-reduction targets – prompting investors to buy long-dated gover…
Tax, spending and investment: Where the Budget ranks in history
The Government has committed to the longest sustained period of high spending since the Second World War. Rachel Reeves’s second Budget as Chancellor has set the UK on a path towards levels of tax, spending and investment not seen for many years, according to the latest economic forecasts. Here the PA news agency looks at what those forecasts suggest about the likely future of the country’s finances – and how they compare with decades gone by. –…
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