A summary of Rachel Reeves’ first budget

The Budget 2024 – A Summary

The Chancellor, Rachel Reeves, delivered her first budget in October 2024. This is a brief summary of some of the headline measures she announced:

• There was NO rise in income tax, National Insurance paid by workers or VAT.
• Companies will experience an increase in National Insurance payments. They will now pay 15% on salaries above £5,000.
• Capital Gain Tax, a tax paid on the profits from selling shares, will be raised from 10% to 18%.
• The minimum wage for over 21s will rise to £12.21 per hour.
• The minimum wage for 18-20 year olds will rise to £10.

Spending:

• Spending on Health and Education in England will rise by 4.7% this year.
• Defence spending will increase by £2.9bn.
• Home Office spending to shrink by 3.1%.
• £1.3bn extra funding for local councils.

UK Economic Health

• The rules by which the UK government classifies its debt has been changed so that the governmetn can borrow more money.
• As a consequence, UK borrowing will increase by £19.6bn this year.
• The Office of Budget Responsibility says that the UK economy will grow by 1.1% this year and 2% next year.
• Inflation will average at 2.5% this year.