Rachel Reeves
- This budget raises taxes by GBP40 billion
- We will maintain BOE's 2% inflation target
- OBR says budget will boost long term growth
- Will balance budget in third year
- Confirms earlier reported rise in minimum wage
- Will 'catalyze' 70 billion pounds through new National Wealth Fund
- Will increase employers' national insurance contribution by 1.2 percentage points
- Will reduce threshold for paying national insurance to 5000 pound by employers
- Capital gains tax: lower rate will rise to 18% from 10%, higher rate will rise to 24% from 20%
- Capital gains rise will raise GBP2.5B
- Inheritance tax threshold freeze to be extended by 2 years
- Will increase soft drink levy, will introduce tax on vaping liquids
- Will cut duties on draught beer in pubs
- Will abolish non-domiciled tax regime
- Will introduce a residence based regime
- Non-domiciled tax regime will raise 12.7 billion over next five years
- Will raise tax on private equity carried interest to 32%
- Energy wildfall tax will rise to 38%
- Stamp duty on second homes to rise 2 percentage points
- Fuel duty will be frozen for another year
- Puts VAT on private schools and removes their business rates relief
Looking at the GDP forecasts changes from March:
- 2024: Up from 0.8% to 1.1%
- 2025: Up from 1.9% to 2.0%
- 2026: Down from 2.0% to 1.8%
- 2027: Down from 1.8% to 1.5%
- 2028: Down from 1.7% to 1.5%
- 2029: New forecast of 1.6%
For CPI changes from March:
- 2024: Up from 2.2% to 2.5%
- 2025: Up from 1.5% to 2.6%
- 2026: Up from 1.6% to 2.3%
- 2027: Up from 1.9% to 2.1%
- 2028: Up from 2.0% to 2.1%
- 2029: New forecast of 2.0%
The CPI forecasts are notably higher but the pound is at the lows of the day, down 77 pips to 1.2940. This is Labour's first budget in 15 years.
