The UK government has unveiled a tax-raising budget, with Chancellor Rachel Reeves announcing £26 billion in tax increases to address the country’s economic challenges. The budget, which aims to reduce debt and fund public services, includes measures such as freezing income tax thresholds, increasing taxes on dividends, property, and savings, and introducing a new “mansion tax” on high-value homes. The Office for Budget Responsibility (OBR) has downgraded its growth forecast for the UK economy, citing lower productivity growth and the impact of Brexit.
The tax hikes are expected to affect workers, savers, and investors, with the OBR predicting that the tax burden will rise to 38.3% of GDP by 2030-31, the highest level on record. The budget also includes measures to support low-income households, such as increasing the National Living Wage to £12.71 per hour and freezing rail fares and prescription charges.
The budget has been met with mixed reactions, with some welcoming the measures to address the cost of living crisis, while others criticize the tax increases for potentially harming economic growth. The OBR’s premature release of its economic forecast has also sparked controversy, with opposition parties calling for an investigation.
