Autumn Budget 2024 Live: Rachel Reeves unveils sweeping tax reforms
Welcome to Morning Wire’s Autumn Budget 2024 live blog in association with RBC Wealth Management.
The Chancellor, Rachel Reeves, has set out out Labour’s tax and spending plans for the year ahead in the party’s first budget since coming to power over the summer.
The Budget contains some of the biggest tax hikes in a generation, with the Chancellor laying out plans to increase the tax take by £40bn.
The biggest tax change was the 1.2 per cent increase in employers’ national insurance contributions, which is expected to raise £25bn of the total. There are also changes to the level at which employers have to start paying the tax.
The Chancellor has also published plans to abolish the nom-dom tax regime from 2025 and introduce a new “residence-based scheme with internationally competitive arrangements for people coming to the UK on a temporary basis”.
There have also been major reforms outlined to capital gains tax and inheritance tax in the Autumn Budget.
The government will increase the lower rate of capital gains tax from 10 per cent to 18 per cent, and the higher rate from 20 per cent to 24 per cent. The residential property thresholds will remain unchanged.
Alongside changes to pension pots, the Chancellor confirmed that she was extending the freeze on thresholds until 2030. The threshold freeze was due to expire in 2028.
Reeves also announced that she would cap relief on the inheritance of agricultural land and family businesses, both of which can be passed on tax free under current rules.
Finally, the inheritance tax break for AIM has been partially abolished in the Autumn Budget, as only a 50 per cent relief from inheritance tax will be applied to its shares, setting the effective tax rate at 20 per cent.