Chancellor Rachel Reeves confirmed a wide package of tax, welfare, transport and business measures.
Several announcements had been trailed in advance, while others emerged early after the OBR mistakenly published its forecast.
Taxation
- National Insurance and income tax thresholds frozen for three extra years beyond 2028.
- Cash ISA limit for under-65s capped at £12,000 from April 2027; the remaining allowance reserved for investments.
- Dividend tax rates rise by 2 percentage points from April; all savings income tax rates increase from 2027.
- Treasury forecasts show the Budget will raise £26bn by 2029/30, mainly from frozen thresholds and pension salary sacrifice changes.
Wages, Benefits and Pensions
- Two-child benefit cap scrapped from April 2027.
- Minimum wage for over-21s increases 4.1% to £12.71; pay for 18–20-year-olds rises to £10.85.
- State pension rises 4.8% under the triple lock.
- Salary sacrifice for pensions capped at £2,000 per year from 2029.
- Help to Save extended beyond 2027.
Housing & Property
- English homes valued over £2m face a council tax surcharge of £2,500–£7,500.
- Tax on rental income rises by 2 percentage points from 2027.
Transport
- 5p fuel duty cut extended to September 2026, then phased out.
- Mileage-based tax for EVs and plug-in hybrids introduced from 2028.
- Premium cars removed from the Motability scheme.
Business Measures
- Employer NI thresholds frozen until 2031.
- £135 VAT exemption for small overseas parcels scrapped from 2029.
- Remote gaming duty rises from 21% to 40% in 2026; online sports betting duty rises to 25% in 2027.
Household Bills
- Green levies moved off energy bills into general taxation, saving households £88.
- Scrapping a home-insulation support scheme saves a further £59.
Drinking & Smoking
- Sugary drinks tax extended to pre-packaged milkshakes and lattes from 2028.
- Tobacco duty rises 2% above RPI; alcohol duty rises by RPI next February.
Growth, Inflation & Debt
- OBR forecasts 1.5% growth this year (up from 1%).
- Growth between 2026–2029 downgraded to 1.5% on average.
- Inflation expected to fall from 3.5% this year to 2.5% next year, reaching the 2% target in 2027.