Budget tax rises may be ‘fiscal fiction’ as pain delayed for election year, IFS warns

Chancellor Rachel Reeves has presented the UK Budget for 2025, which includes a £26 billion tax increase and increased welfare spending aimed at addressing the ongoing cost of living crisis. This budget is a significant move for the Labour government as it seeks to balance fiscal responsibility with the needs of citizens facing economic challenges.

Chancellor Rachel Reeves's recent budget includes a tax break for wealthy former non-domiciled individuals, significantly reducing their inheritance tax liabilities. Experts indicate that this benefit primarily favors those with assets exceeding £83 million, raising concerns about equity in tax policy.

Businesses in Surrey have expressed mixed reactions to Chancellor Rachel Reeves' recent Budget, which includes significant reforms aimed at addressing the ongoing cost of living crisis. The Budget features a £26 billion tax increase and changes to welfare policies, which have sparked varied responses from local enterprises.

Rachel Reeves, the UK Chancellor of the Exchequer, delivered a pre-budget speech in early November, indicating a potential income-tax rise, despite having received favorable fiscal forecasts that suggested more financial flexibility than anticipated. This unusual approach aimed to prepare the public for significant changes ahead of her upcoming budget announcement.

Chancellor Rachel Reeves announced a series of tax increases in the Autumn Budget, which will affect nearly all taxpayers in the UK. The budget includes a £26 billion tax hike, raising the UK's tax take to an unprecedented 38% of GDP by the end of the parliamentary term, aimed at stabilizing the economy amidst ongoing financial challenges.

The National Union of Students (NUS) has raised concerns over a three-year freeze on the salary threshold for student loan repayments, set at £29,385 from April 2027. This decision, announced in Chancellor Rachel Reeves's budget, could force graduates in low-paid jobs to repay their loans sooner and in larger amounts, potentially impacting their ability to afford basic living expenses.

Economists have expressed concerns regarding the UK budget presented by Chancellor Rachel Reeves, which includes a £26 billion tax increase aimed at stabilizing the economy. The budget has been criticized for its reliance on back-loaded tax rises that may not materialize, raising doubts about its sustainability and effectiveness in addressing economic challenges.

The Institute for Fiscal Studies (IFS) has reported that average disposable income in the UK is projected to increase by only 0.5% annually over the next five years, indicating a dismal outlook for household spending power. This stagnation in income growth raises concerns about the financial well-being of families across the country.