UK prepares for autumn budget

Tomorrow Chancellor Rachel Reeves will deliver Labour’s first budget in 14 years. It will also be the first budget to be delivered by a female chancellor.

When Labour won the general election back in July, Reeves said the party had “inherited the worst set of circumstances since the Second World War” so there has been an emphasis from the government on making “difficult financial decisions”.

Sources have said the Chancellor is drawing up plans to find £40bn pounds to avoid having to cuts to government departments.

She has suggested the gap will be filled with tax rises rather than spending cuts, saying there will be “no return to austerity”.

Labour have said they will not be raising income tax, VAT or national insurance. They also promised not to increase taxes on “working people”, although there has been some confusion as to what that actually means.

The Conservatives have accused Labour of “reinventing” what counts as a working person, and the prime minister did concede that his own definition was “broad”.

Some changes have already been announced:

• – The state pension will rise by 4% in April next year.
• – Winter fuel payments will only be made available to people getting pension credit or other means-tested help.
• – The energy profits levy on oil and gas companies will rise from 35% to 38% at the start of next month, and will remain in place for around five years.
• – The single fare cap on many bus routes across England will rise from £2 to £3.

It is thought there will be changes to inheritance tax, pensions tax, capital gains tax and more; the full details will be revealed in Rachel Reeves’ speech on Wednesday, most likely about 12:30PM.