Sir Keir Starmer has insisted the government will keep its manifesto pledges amid reports the Chancellor could extend the freeze on income tax thresholds in this month’s Budget.
Rachel Reeves may be considering pushing the freeze beyond its current expiry date of 2028 in a move that could raise £7 billion, according to the Financial Times.
Continuing the freeze could help plug some of the £40 billion gap the Chancellor is grappling with in an effort to avoid a return to austerity.
Labour’s manifesto promised not to increase rates of income tax, but included no mention of tax thresholds.
The Treasury has so far declined to comment on Budget speculation, but when asked about possible tax changes during a press conference in Berlin, Sir Keir Starmer said: “We are going to keep our manifesto pledges.”
He added: “I’m not going to pre-empt the individual measures that will be outlined by the Chancellor in due course.”
Other measures reported to be under consideration include increasing employers’ national insurance contributions, raising fuel duty for the first time since 2010, changes to rules on inheritance tax and stamp duty, and a levy on e-cigarettes
We’ll be bringing you all the latest updates ahead of the big event on 30 October here, on The Independent’s liveblog.
Key points
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When is the 2024 Budget and what might be in it?
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Ministers plead with PM to soften Reeves’ spending cuts
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Inflation falls below 2% target for first time in three years
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Proposed national insurance hike sparks row
When is the 2024 Budget and what might be in it?
09:43 , Jabed Ahmed
Chancellor Rachel Reeves will deliver Labour’s first Budget on Wednesday 30 October.
Each year, the chancellor of the exchequer – who is in charge of the government’s finances – makes a Budget statement to MPs in the House of Commons.
The speech outlines the government’s plans for spending and taxes.
The Budget speech usually starts around 12:30pm and lasts about an hour. The Independent will be bringing you all the latest updates on the big day.
Ms Reeves may be considering pushing the freeze beyond its current expiry date of 2028 in a move that could raise £7 billion, according to the Financial Times.
Other measures reported to be under consideration include increasing employers’ national insurance contributions, raising fuel duty for the first time since 2010, changes to rules on inheritance tax and stamp duty, and a levy on e-cigarettes, according to reports across the media.
The Treasury has so far declined to comment on Budget speculation.
What should I do with my savings ahead of the Budget?
03:00 , Howard Mustoe
Ahead of the Budget on 30 October, there has been fevered speculation about changes to pension savers’ tax allowances and other perks.
Reports that pensioners could have tax breaks cut or axed led to savers withdrawing chunks of their retirement pots ahead of Chancellor Rachel Reeves’s big announcement.
What should I do with my savings ahead of the Budget?
The real problem facing Rachel Reeves over the death tax…
01:00 , James Moore
… is that not only is it deeply unpopular, cautions James Moore – but it’s only a drop in the ocean when it comes to plugging the UK’s vast fiscal black hole
The real problem facing Rachel Reeves over the death tax…
Tax-free cash withdrawals ‘surge while pension contributions plummet’ as savers panic over Budget rumours
Friday 18 October 2024 23:00 , Howard Mustoe
Retirees are rushing to withdraw cash from their pensions ahead of feared cuts to tax-free benefits in the Budget, the boss of one of Britain’s top investment platforms has said.
Savers can typically take 25 per cent of their pension as a lump sum, up to a limit of £268,275, allowing them to avoid paying income tax, but Chancellor Rachel Reeves is reportedly considering a cut to the amount savers can withdraw without triggering a payment to HM Revenue & Customs.
Tax-free cash withdrawals surge as savers panic over Budget rumours
Workers set for income tax hike as Rachel Reeves ‘to extend freeze on thresholds’
Friday 18 October 2024 22:11 , Tom Watling
Workers set for income tax hike as Rachel Reeves ‘to extend freeze on thresholds’
ICYMI: How make-or-break Budget has fractured Keir Starmer’s cabinet
Friday 18 October 2024 20:05 , Archie Mitchell
Rachel Reeves’ Budget is a make-or-break moment for Sir Keir Starmer’s government, potentially sparking a decade of national renewal – or sowing the seeds of Labour’s downfall.
The prime minister’s poll ratings are at rock bottom after just over 100 days in charge, and the much-hyped “tough choices” to be unveiled on October 30 will likely do little to help boost his appeal.
How make-or-break Budget has fractured Keir Starmer’s cabinet
Keir Starmer’s cabinet is rebelling – what took them so long?
Friday 18 October 2024 19:00 , John Rentoul
Led by Angela Rayner, several cabinet ministers have broken ranks on the chancellor’s demand for swingeing budget cuts – and the only winner from this early breakdown of party discipline will be the prime minister, says John Rentoul
Starmer’s cabinet is rebelling – what took them so long?
Keir Starmer’s warning to ministers after cabinet Budget row erupts
Friday 18 October 2024 18:00 , Albert Toth
Sir Keir Starmer has warned his senior ministers they will have to live with swingeing spending cuts after a cabinet row over the Budget erupted in public.
The prime minister is facing a backlash from Angela Rayner and other members of his top team over cuts to government departments set to be unveiled by the chancellor, Rachel Reeves.
Keir Starmer’s warning to ministers after cabinet Budget row erupts
Inheritance tax to rise in Budget as Reeves plans to hit well-off
Friday 18 October 2024 17:05 , Millie Cooke
The Treasury is reportedly considering plans to raise Inheritance Tax at the Budget, as part of an attempt to raise £40bn and plug a hole in the public finances.According to the BBC, the chancellor is considering multiple changes to the tax, which is charged at 40 per cent on the property, possessions and money of somebody who has died above a £325,000 threshold.
Inheritance tax to rise in Budget as Reeves plans to hit well-off
Budget 2024: Inheritance tax set to rise – here’s what it means for you
Friday 18 October 2024 16:00 , Salma Ouaguira
Chancellor Rachel Reeves is reportedly planning changes to inheritance tax at the Budget as she looks to raise up to £40bn from tax hikes and spending cuts.
While specifics remain unclear, any changes could significantly affect how much families pay on inherited properties and their financial futures.
Inheritance tax set to rise – here’s what it means for you
Stamp duty threshold to drop as Reeves denies extension
Friday 18 October 2024 15:16 , Albert Toth
The chancellor is reportedly planning to confirm that the heightened stamp duty threshold will drop back to previous levels in March, costing housebuyers up to £2,500 more.
In 2022, the Conservatives under Liz Truss increased the ‘nil rate’ threshold – when stamp duty starts being paid – from £125,000 to £250,000. For first-time buyers, it rose from £300,000 to £425,000.
The approach is expected to raise £1.8 billion a year by 2029-30, but experts have warned the news will cause “chaos” in the property market as buyers rush deals to save money.
Property expert Kirstie Allsopp told Times Radio: “It’s become so complicated that I can no longer tell anyone what they would be paying in stamp duty.”
“It won’t claw back any money. Stamp duty is a dead tax.”
Reeves warned inheritance tax hike would punish middle classes as Budget backlash intensifies
Friday 18 October 2024 14:30 , Albert Toth
Chancellor Rachel Reeves has been warned that her plan to hike inheritance tax risks punishing middle-class homeowners as the backlash against her Budget intensified.
Ms Reeves is considering an increase on the “death tax”, which raises about £7bn for the Treasury each year, despite the fact it is routinely found to be one of voters’ least favourite measures.
Budget backlash intensifies as Rachel Reeves warned over inheritance tax hike
How DWP rules for disability benefit assessment could change as Reeves’ Budget approaches
Friday 18 October 2024 13:39 , Albert Toth
Changes to disability benefit assessments are set to come into force soon as Rachel Reeves reportedly pushes ahead with plans to shave £3 billion from the welfare bill ahead of Labour’s upcoming Budget.
Read all about the proposed plans here:
New DWP rules for disability benefit assessment under Rachel Reeves’ Budget plan
Inheritance tax to rise in Budget as Reeves plans to hit well-off
Friday 18 October 2024 11:30 , Albert Toth
The Treasury is reportedly considering plans to raise Inheritance Tax at the Budget, as part of an attempt to raise £40bn and plug a hole in the public finances.
According to the BBC, the chancellor is considering multiple changes to the tax, which is charged at 40 per cent on the property, possessions and money of somebody who has died above a £325,000 threshold.
Inheritance tax to rise in Budget as Reeves plans to hit well-off
Independent readers name their priorities for Labour Budget
Friday 18 October 2024 10:30 , Albert Toth
With a new Labour government in power and the first autumn statement on the horizon, we wanted to hear your economic priorities.
When we asked what you thought should be included in the budget, responses from Independent readers varied widely.
Here’s a closer look:
Readers name their priorities for Rachel Reeves’ looming Labour budget
Reeves considers raising tax on vaping in Budget
Friday 18 October 2024 09:28 , Albert Toth
Rachel Reeves is considering raising the tax on vaping products in the upcoming Budget as figures lay bare how many children access them in the UK, The Guardian reports.
The tax on vaping products was originally announced by the Conservatives in March, to come in to force in 2026. It is now understood that Ms Reeves could look to increase this.
Under current plans, the new rates from April 2026 will range from £1-3 per 10ml of liquid, depending on nicotine level.
Reeves’ capital gains tax plans will sidestep homeowners, reports say
Friday 18 October 2024 09:07 , Albert Toth
Experts have long anticipated that Labour will put capital gains tax up in the Budget on 30 October. This is the levy is paid on the profit made when an asset which has increased in value is sold. This includes houses, assets and shares, all paid between 20 and 28 per cent.
The latest reports indicate that Ms Reeves will respond to calls to raise capital gains tax in line with income tax bands – meaning rates of 20 to 40 per cent – but will exempt property from the new rates.
Rachel Reeves to push forward with £3bn sickness benefits cut in Budget
Friday 18 October 2024 08:57 , Millie Cooke
Rachel Reeves is understood to be considering about £3bn of cuts to the welfare bill over the next four years by restricting access to sickness benefits, as the chancellor embarks on a brutal cost-cutting mission to fill a so-called £22 billion black hole left by the Tories.
The chancellor is expected to save the £3bn sum by committing to the previous government’s plans to reform work capability rules.
Rachel Reeves to push forward with sickness benefits cut in Budget
Independent readers name their priorities for Rachel Reeves’ looming Labour budget
Friday 18 October 2024 15:59 , Albert Toth
When we asked what you thought should be included in the budget, responses from Independent readers varied widely.
Many called for a fairer tax system and more direct contributions for public services, while others petitioned for fewer regulations and ‘red tape’ to improve productivity.
Read more:
Readers name their priorities for Rachel Reeves’ looming Labour budget
ICYMI: Angela Rayner leads Cabinet revolt against Reeves’ ‘huge’ Budget cuts
Friday 18 October 2024 07:00 , Archie Mitchell
Sir Keir Starmer is facing a backlash from Angela Rayner and his cabinet over “huge” cuts to departmental spending to be unveiled in Rachel Reeves’ Budget.
The prime minister has received letters from senior ministers raising concerns about the spending cuts after a number spoke out against the measures at Tuesday’s cabinet meeting.
Angela Rayner leads Cabinet revolt against Reeves’ ‘huge’ Budget cuts
Budget rumours: Capital Gains reform
Friday 18 October 2024 04:00 , Albert Toth
Capital Gains Tax (CGT) is paid on the profit made when an asset which has increased in value is sold. It is applied to things like the sale of personal possessions worth more than £6,000 (apart from a car), property that’s not the seller’s main home, shares and business assets.
It is charged at 10 or 18 percent for basic rate taxpayers, and 20 or 24 for higher or additional rate earners. There is a tax-free allowance of £3,000.
There are several ways CGT could be changed. In the run-up to the election, the Lib Dems and Greens both said they would rethink the tax bands to be more similar to income tax, raising an estimated £5.2bn a year.
Analysis: How make-or-break Budget has fractured Keir Starmer’s cabinet
Friday 18 October 2024 01:00 , Archie Mitchell
Rachel Reeves’ Budget is a make-or-break moment for Sir Keir Starmer’s government, potentially sparking a decade of national renewal – or sowing the seeds of Labour’s downfall.
The prime minister’s poll ratings are at rock bottom after just over 100 days in charge, and the much-hyped “tough choices” to be unveiled on October 30 will likely do little to help boost his appeal.
How make-or-break Budget has fractured Keir Starmer’s cabinet
ICYMI: Millionaires urge Reeves to raise £14bn from capital gains tax changes at Budget
Thursday 17 October 2024 22:00 , Albert Toth
Rachel Reeves should increase capital gains tax (CGT) at Labour’s upcoming Budget, a group of millionaire business owners have urged, estimating the measure would raise £14bn a year.
In a report by the IPPR think-tank, analysts have consulted with wealthy entrepreneurs who say higher CGT would not have stopped them from making investments in the UK.
Millionaires urge Reeves to raise £14bn from capital gains tax changes at Budget
Budget rumours: Private equity profits
Thursday 17 October 2024 19:00 , Albert Toth
In another manifesto pledge, Labour said it will announce more details on plans to close the private equity tax loophole in the October Budget.
Due to the ‘carried interest’ law, private equity fund managers pay only 28 per cent tax on their income, which is treated as capital gains. This was the result of a successful lobbying campaign in 1987.
Labour has vowed to change this, making managers pay the 45 per cent higher rate of income tax. It is estimated the change will raise around £600 million a year with just a few thousand people affected.
Budget rumours: Employer National Insurance Contributions
Thursday 17 October 2024 16:00 , Albert Toth
National insurance contributions (NICs) are the UK’s second-largest tax after income tax. They are paid by both employees on their own earnings, and employers on the earnings of their employees.
Labour officials say they will uphold the manifesto pledge to not raise NICs for employees above the recently lowered rate of 8 per cent. However, speculation has mounted that this could leave the door open for an increase in the rate paid by employers, with both the chancellor and prime minister refusing to rule out the measure.
Employer NICs are currently paid at a flat rate of 13.8 per cent. Experts say an increase of just 1p could raise £8.5bn in 2025/26 and more for the following years.
How make-or-break Budget has fractured Keir Starmer’s cabinet
Thursday 17 October 2024 13:20 , Albert Toth
Rachel Reeves’ Budget is a make-or-break moment for Sir Keir Starmer’s government, potentially sparking a decade of national renewal – or sowing the seeds of Labour’s downfall.
The prime minister’s poll ratings are at rock bottom after just over 100 days in charge, and the much-hyped “tough choices” to be unveiled on October 30 will likely do little to help boost his appeal.
How make-or-break Budget has fractured Keir Starmer’s cabinet
Millionaires urge Reeves to raise £14bn from capital gains tax changes at Budget
Thursday 17 October 2024 11:25 , Albert Toth
Rachel Reeves should increase capital gains tax (CGT) at Labour’s upcoming Budget, a group of millionaire business owners have urged, estimating the measure would raise £14bn a year.
In a report by the IPPR think-tank, analysts have consulted with wealthy entrepreneurs who say higher CGT would not have stopped them from making investments in the UK.
Millionaires urge Reeves to raise £14bn from capital gains tax changes at Budget
Angela Rayner leads Cabinet revolt against Reeves’ ‘huge’ Budget cuts
Thursday 17 October 2024 10:14 , Archie Mitchell
Sir Keir Starmer is facing a backlash from Angela Rayner and his cabinet over “huge” cuts to departmental spending to be unveiled in Rachel Reeves’ Budget.
The prime minister has received letters from senior ministers raising concerns about the spending cuts after a number spoke out against the measures at Tuesday’s cabinet meeting.
Angela Rayner leads Cabinet revolt against Reeves’ ‘huge’ Budget cuts
Ministers plead with PM to soften Reeves’ spending cuts
Thursday 17 October 2024 09:22 , Albert Toth
Several ministers have reportedly written to Number 10 urging the prime minister to soften departmental spending cuts laid out in the upcoming Budget.
The requests have gone over the head of Rachel Reeves, who is reportedly looking to find around £40bn in tax rises and spending cuts on 30 October.
It is an embarrassing show of disunity for the prime minister, indicating that ministers and Ms Reeves may not be seeing eye-to-eye on departmental budgets.
It’s understood that the complaints have come from the Ministry of Housing, Department for Transport, Ministry of Justice. Unlike health and education, these departments have ‘unprotected’ budgets, meaning they could see severe cuts.
One Cabinet minister told Sky News: “The briefing doesn’t match the reality. It’s pain this year, and pain next year. We’re simply going to be digging a hole which we end up filling in later in the year.”
Budget rumours: business rates reform
Thursday 17 October 2024 03:00 , Albert Toth
In its election manifesto, Labour said it was committed to reforming the current business rates system “so we can raise the same revenue but in a fairer way”.
What this means has not been spelt out by the party, but it said the new system will be designed to “level the playing field between the high street and online giants, better incentivise investment, tackle empty properties and support entrepreneurship”.
It’s thought this could take the form of an immediate cut to the rates, while also closing loopholes which allow some firms to avoid tax. This will come as welcome news to smaller business owners, but Labour will be careful to ensure their reform maintains a monetary net zero.
Exchequer secretary James Murray MP confirmed this at a Labour conference fringe event hosted by the British Retail Consortium, saying: “It’s within the current envelope. It’s all about raising the same amount of money overall, that’s the commitment.”
ICYMI: Inflation drop ‘badly-timed’ for benefit claimants as next increase revealed
Thursday 17 October 2024 00:01 , Albert Toth
Inflation has dropped below 2 per cent for the first time in over three years, raising hopes that the Bank will cut interest rates in November. The decrease exceeded many economist predictions, with the Consumer Price Index (CPI) falling to 1.7 per cent
But some experts have warned that the rate drop is “badly timed” for many people, as it will be a key factor in how much benefits are uprated by the DWP next April.
Inflation drop ‘badly-timed’ for benefit claimants as next increase revealed
Budget rumours: fuel Duty increase
Wednesday 16 October 2024 21:00 , Albert Toth
Fuel duties, or taxes, apply to purchases of petrol, diesel and a variety of other fuels used both for vehicles and domestic heating.
The level of fuel duty depends on the type of fuel used, with a litre of petrol, diesel, biodiesel and bioethanol attracting a fuel duty of 52.95p. It was cut by 5p by the Conservatives in 2022, after being frozen at 57.95p since 2011.
It represents a significant source of revenue for the government, expected to raise £24.7 billion in 2023-24, according to the Office for Budget Responsibility – equivalent to 2.2 per cent of all receipts.
Scrapping the 5p cut would raise the government an estimated £2bn. However, doing so would not automatically force fuel retailers to bring down their costs, likely meaning higher fees for motorists, at least in the short term.
ICYMI: Rachel Reeves boosted by big drop in inflation as she seeks £40bn in Budget tax rises
Wednesday 16 October 2024 20:00 , Albert Toth
Rachel Reeves has been boosted by a sharp drop in inflation as she seeks to find £40bn of tax hikes and spending cuts in this month’s Budget.
The chancellor will welcome the dip, which saw inflation fall under the Bank of England’s 2 per cent target for the first time in more than three years, as she prepares for what promises to be a brutal Budget.
Rachel Reeves boosted by big drop in inflation as she seeks £40bn in Budget tax rises
Budget rumours: welfare spending cuts
Wednesday 16 October 2024 18:00 , Albert Toth
Labour has made no secret of its ambition to reduce the government’s welfare spending bill, so Ms Reeves will likely take the Budget as her opportunity to do so.
Speaking at Labour’s party conference, the prime minister said: “We will get the welfare bill down because we will tackle long-term sickness and support people back to work.”
What has been confirmed is a crackdown on benefit fraud, which looks to save £1.6bn over the next five years. Also possible is the mooted reform to disability benefits through personal independence payments (PIP) or the work capability assessment (WCA).
What would you like to see announced in Rachel Reeves’ budget?
Wednesday 16 October 2024 17:00 , Albert Toth
We would like to hear your thoughts on what you would like to see introduced in Reeves’ Budget. Should she focus on measures to support homeowners, such as the Freedom to Buy scheme? Or would you prefer a focus on closing tax loopholes, such as abolishing non-dom status, to ensure a fairer tax system?
Tell us what you’d like to see announced in Labour’s first budget
Inflation drop ‘badly-timed’ for benefit claimants as next increase revealed
Wednesday 16 October 2024 15:33 , Albert Toth
Inflation has dropped below 2 per cent for the first time in over three years, raising hopes that the Bank will cut interest rates in November. The decrease exceeded many economist predictions, with the Consumer Price Index (CPI) falling to 1.7 per cent
But some experts have warned that the rate drop is “badly timed” for many people, as it will be a key factor in how much benefits are uprated by the DWP next April.
Inflation drop ‘badly-timed’ for benefit claimants as next increase revealed
ICYMI: Ex-Bank of England chief urges Rachel Reeves to raise national insurance
Wednesday 16 October 2024 13:14 , Albert Toth
In an open letter published in The Independent, Mervyn King warns the chancellor against higher borrowing
“Be courageous, be bold, and ensure that the economic inheritance we leave to our grandchildren is one of which both they and we can be proud.
“One day, you will look back on your time as chancellor and you will want to remember the far-reaching changes you made – not the political compromises that others will urge on you.”
Controversial weight-loss jab policy revealed ahead of Budget
Wednesday 16 October 2024 11:53 , Albert Toth
Ahead of the Budget on 30 October, it has been revealed that a trial is underway where unemployed people will be given weight-loss jabs to assist them back into work.
The UK’s life sciences sector will receive £279 million from drugs giant Eli Lilly, to invest in developing new medicines and ways to deliver treatment.
“The long-term benefits of these drugs could be monumental in our approach to tackling obesity. For many people, these jabs will be life-changing, help them get back to work and ease the demands on our NHS,” health secretary Wes Streeting wrote in The Telegraph.
Unemployed to be given weight-loss jab to help them back into work, government says
Rachel Reeves boosted by big drop in inflation as she seeks £40bn in Budget tax rises
Wednesday 16 October 2024 10:03 , Albert Toth
Rachel Reeves has been boosted by a sharp drop in inflation as she seeks to find £40bn of tax hikes and spending cuts in this month’s Budget.
The chancellor will welcome the dip, which saw inflation fall under the Bank of England’s 2 per cent target for the first time in more than three years, as she prepares for what promises to be a brutal Budget.
Rachel Reeves boosted by big drop in inflation as she seeks £40bn in Budget tax rises
Would raising employer national insurance be a ‘tax on working people’?
Wednesday 16 October 2024 10:00 , Albert Toth
Labour came under criticism in recent days after several ministers refused to rule out that an increase in employer national insurance contributions (NICs) will be announced in the upcoming budget.
Ministers and Treasury officials have indicated the government’s position is that the measure would not break their manifesto pledge. Meanwhile, Institute for Fiscal Studies director Paul Johnson has argued it would be a “straightforward breach.”
Here are the facts about the debate and how the measure could affect you:
Fact check: Would a employer national insurance hike be a ‘tax on working people’?
Inflation falls below 2% target for first time in three years
Wednesday 16 October 2024 08:02 , Albert Toth
UK inflation has decreased to below the 2 per cent target for the first time in over three years.
The consumer price index (CPI) has dropped to 1.7 per cent, down from 2.2. per cent in August, according to the Office for National Statistics.
The figure has beaten expert predictions, which largely estimated a more modest drop to 1.9 per cent.
Inflation falls below 2% target for first time in three years
