Overview
- After abandoning a mooted income‑tax rate rise, the chancellor is expected to rely on extended income tax threshold freezes and a suite of smaller levies to raise revenue.
- The package is widely reported to include scrapping the two‑child benefit cap, costing roughly £3–£3.5bn a year, and confirming a triple‑lock state pension increase worth more than £550 for those on the full rate.
- Treasury plans under discussion include capping tax‑advantaged pension salary‑sacrifice contributions, with estimates of £3–£4bn in extra revenue, alongside an expanded Universal Credit fraud review aimed at £1.2bn by 2031.
- Further measures being considered include a surcharge on properties valued above £2m, a potential pay‑per‑mile charge for electric vehicles, and a freeze on rail fares.
- The CBI and former Bank of England officials caution that layering new taxes could deter investment and unsettle markets as Reeves seeks to close an estimated ~£20bn fiscal gap.