British finance minister Rachel Reeves handed in her budget statement to the parliament on Wednesday, imposing more tax on workers, pension saving people and investors to provide herself with additional leeway to achieve her borrowing objectives.
The main steps she introduced are listed below:
Income tax threshold freeze: Reeves said Britain will keep the income tax payment thresholds frozen over three more years starting in 2028, and the efforts will increase the amount of revenue raised by 7.6 billion pounds (10.1 billion dollars) in 2029/30.
New tax on expensive homes: Starting in 2028, Reeves will introduce a new high-value council tax charge in England, with an annual charge of 2500 pounds on properties over 2 million pounds, and 7500 pounds on properties over 5 million pounds.
Freeze on fuel duty rates: Britain will also freeze the rate of the fuel duty. Reeves announced that a temporary 5 pence reduction in fuel duty that was brought in due to the COVID -19 pandemic and will be removed in April next year should be continued until September 2026.
Two child welfare cap- April will see the two child limit on welfare payments lifted, Reeves said. With the two child welfare cap, which was implemented by the Conservative government in 2017, rhe families with low incomes would not be receiving any additional benefits when adding a third child or other children.
New electric cars charge- In April 2028, a new charge in the form of a mileage payment on electric and plug-in hybrid cars would come into force, which will increase revenue by 1.4 billion pounds.
Dividend tax rates: Reeves stated that the government will raise the tax rates of the dividends by 2 percentage points. Basic rate of tax dividend tax rate will rise to 10.75 percent in April of following year and higher rate of tax to 35.75% , the OBR said.
Commercial property tax alterations: According to Reeves, commercial property taxes (or business rates) will be reduced on high-value properties permanently, with tax rates on more than 750,000 retail, hospitality, and leisure properties being reduced by half.
Gambling, alcohol: Gambling will have more responsibilities in a move that will earn the government about 1.1 billion pounds by 2029-30. Reeves added that she would also increase alcohol duties according to inflation.
Motability scheme: The so-called motability scheme that enables individuals with disabilities to lease vehicles on state funds will be reformed in a bid to check what Reeves termed as frivolous taxpayer subsidies.
Pension perk slashed: The government will limit the sum of money that can be transferred to pensions prior to National Insurance being imposed on employers and employees to 2000 pounds a year by 2029 and this move is likely to increase the number of pounds by 4.7 billions in 2029/30.
