Budget 2024: what was in the 2024 UK Autumn Budget today - key announcements as billions in tax rises revealed

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Reeves revealed a historic tax increase, aiming to fix public finances and restore services 💰
  • Chancellor Rachel Reeves has announced a £40 billion tax increase in the first Labour budget since 2010
  • The budget aims to address a significant "black hole" in public finances left by the Conservatives
  • Key measures include a £25 billion increase in employers' national insurance contributions and hikes in capital gains tax and tobacco duty
  • The budget also outlines an increase in the stamp duty surcharge for second homes and the soft drinks industry levy, while maintaining a freeze on fuel duty
  • Improvements in the carers allowance and a commitment to invest over £5 billion in housing and infrastructure are included

Chancellor Rachel Reeves has unveiled an Autumn Budget that will raise taxes by £40 billion, pledging to “fix the foundations” of the economy and restore public finances.

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It marked the first Labour budget since 2010 and the first ever presented by a woman, as Reeves emphasised the need to “invest, invest, invest.”

But the Chancellor also said that the “black hole” left by the Conservatives necessitates tens of billions in additional tax revenue.

Reeves added that the extent of the public spending issues she inherited is more severe than previously anticipated.

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She said the £22 billion “black hole” left by the Tories in this year’s finances showed they “hid the reality of their public spending plans”, with problems recurring in future years.

But what does it all mean for you, and will the Budget lead to “more pounds in peoples’ pockets”, as claimed by Reeves? Here is everything you need to know.

Rachel Reeves poses with the red Budget Box as she leaves 11 Downing Street to present the government's annual Autumn budget to Parliament (Photo: JUSTIN TALLIS/AFP via Getty Images)Rachel Reeves poses with the red Budget Box as she leaves 11 Downing Street to present the government's annual Autumn budget to Parliament (Photo: JUSTIN TALLIS/AFP via Getty Images)
Rachel Reeves poses with the red Budget Box as she leaves 11 Downing Street to present the government's annual Autumn budget to Parliament (Photo: JUSTIN TALLIS/AFP via Getty Images) | AFP via Getty Images

Which taxes are going up?

The Chancellor said: “Together, the black hole in our public finances this year, which recurs every year... and their failure to assess the scale of the challenges facing our public services means this Budget raises taxes by £40 billion.

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“Any Chancellor standing here today would face this reality. And any responsible Chancellor would take action. That is why today, I am restoring stability to our public finances and rebuilding our public services.”

Reeves confirmed a £25 billion raid on employers’ national insurance contributions, with higher rates and a lower starting threshold.

The rate will increase by 1.2 percentage points to 15% from April 2025, with payments starting when an employee earns £5,000, down from the current £9,100. “I know that this is a difficult choice. I do not take this decision lightly,” Reeves said.

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The planned increase in national insurance contributions will particularly affect businesses - employers may pass these costs onto employees through lower wages or reduced hiring, which could lead to job insecurity for some workers.

The Chancellor also announced a £2.5 billion increase in capital gains tax by increasing the lower rate from 10% to 18% and the higher rate from 20% to 24%.

These changes could impact those who invest in stocks, properties, or businesses, and investors might see reduced returns, which could affect their financial plans and spending.

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She also confirmed changes to inheritance tax, including bringing pension pots within the tax from April 2027, and reforms to agricultural and business property reliefs, raising a total of £2 billion a year.

The inclusion of pension pots in inheritance tax could lead to more families facing inheritance tax liabilities, reducing the financial benefits passed down to future generations.

But Reeves, who stressed she was committed to helping “working people”, also promised to end the freeze on income tax and national insurance thresholds.

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As earnings increase, maintaining the threshold freeze would have seen more people dragged into paying tax or shifted into higher bands. This change will help people retain more of their earnings as wages rise.

“From 2028-29, personal tax thresholds will be uprated in line with inflation once again,” she said. “When it comes to choices on tax, this Government chooses to protect working people every single time.”

Other highlights from the 2024 Autumn Budget:

  • A flat rate of duty will be applied on all vaping liquid from October 2026 alongside an additional one-off increase in tobacco duty to encourage people to give up smoking.
  • Government departments will be required to meet a 2% “productivity, efficiency and savings target”.
  • The freeze on fuel duty will continue, including maintaining the existing 5p cut.
  • The Government will commit the funding required to extend the HS2 high-speed rail line to Euston in central London.
  • The soft drinks industry levy will be increased to account for inflation.
  • The stamp duty land tax surcharge for second homes will increase by two percentage points to 5% from Thursday 31 October.
  • The weekly earnings limit for carers allowance will rise to the equivalent of 16 hours a week at the national living wage, the largest increase since the allowance was introduced.
  • There will be “over £5 billion of Government investment” in housebuilding, with £1 billion to strip dangerous cladding from buildings.
  • While alcohol duty rates on non-draught products will increase in line with RPI inflation, draught duty will be cut by 1.7%, knocking a penny off a pint in the pub.

What does it mean for me?

While there are measures aimed at protecting workers in the long term, most people are likely to feel worse off as a result of the Autumn Budget and its included tax increases, at least in the short term.

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Higher national insurance contributions will directly reduce take-home pay for many employees, limiting their ability to spend on everyday expenses, while businesses facing increased costs may be less inclined to hire new employees or could cut back on wages, which could negatively impact overall employment levels.

Elsewhere, vapers may face higher costs, which could discourage usage but also contribute to public health efforts to reduce smoking rates. Similarly, the increase in tobacco duty will likely make smoking more expensive, which could push some smokers to give up but also create financial strain for those who continue.

Also in health, the increased soft drinks industry levy could lead to higher prices for sugary drinks, potentially discouraging consumption but also affecting household budgets for those who regularly purchase these products.

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The adjustment to Alcohol Duty may lead to higher prices for bottled and canned drinks but provide a minor financial relief for pub-goers, while the increase in Carers Allowance will provide them with more financial support.

Lastly, the freeze on Fuel Duty should help keep fuel prices stable, which is beneficial for household budgets, especially amid rising costs elsewhere.

What do you think about Chancellor Reeves' budget and its potential impact on your finances? Are you concerned about the upcoming tax increases? Share your opinions and experiences in the comments section.

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