When is the Budget and what might be in it?

Chancellor Rachel Reeves will deliver Labour’s first Budget on Wednesday 30 October.

She has already warned that it will involve “difficult decisions” on tax, spending and benefits.

Prime Minister Sir Keir Starmer told the BBC the “tough” Budget will “focus on rebuilding our country”.

Each year, the chancellor of the exchequer – who is in charge of the government’s finances – makes a Budget statement to MPs in the House of Commons.

The speech outlines the government’s plans for raising or lowering taxes.

It also includes big decisions about spending on health, schools, police and other public services.

The previous Conservative Chancellor, Jeremy Hunt, delivered the last Budget in March 2024, before the general election.

But after a change of government, the new chancellor holds another Budget to set out their financial priorities.

The 2024 autumn Budget is on Wednesday 30 October.

The Budget speech usually starts at about 12:30 UK time and lasts about an hour. It will be broadcast live on the BBC iPlayer and on the BBC News website.

The current leader of the opposition, Conservative Party leader Rishi Sunak, will give a speech responding to the Budget as soon as Reeves sits down.

At the election Labour promised not to increase taxes on “working people”, and said it would not raise VAT (value added tax), income tax or National Insurance (NI).

But after the warning about “difficult decisions”, there has been a lot of speculation about other possible tax rises:

National Insurance contributions by employers

The prime minister and the chancellor have both refused to rule out an increase in employer NI payments.

Reeves has said Labour’s election pledge related to the employee element.

Employers currently pay NI on their workers’ earnings at a rate of 13.8%.

At the moment companies do not pay NI on pension contributions they make for staff, but reports have suggested this could change.

Businesses have argued that raising NI for employers will make it harder to hire staff and create jobs.

Capital gains tax (CGT)

CGT is charged on the profit made from the sale of assets that have increased in value, such as second homes or investments.

It is paid by individuals and some business owners, and the rates vary depending on how much income tax you pay.

For higher earners, the levy is currently 24% on gains from selling additional property, or 20% on profits from other assets like shares.

There has been speculation that rate could be increased in the Budget, although the prime minister appeared to dismiss suggestions that it could rise as high as 39%.

Some argue CGT rates should rise as they are lower than income tax and therefore benefit the wealthy. Others say that raising the rates will hit Labour’s plans to grow the economy.

Pension taxation

There are various ways the chancellor could raise more money by changing the way private pensions are taxed.

That could include reducing the cap on tax-free lump sums from pension pots, cutting the tax break for employers putting money into employees’ pensions, or changing the system of tax relief on pension contributions.

At the moment, savers receive tax relief at the same rate as their income tax – so basic rate taxpayers get tax relief at 20% and higher rate taxpayers at 40% or 45%.

The government could introduce a single flat rate of relief which would make the system less generous for higher earners, although reports have suggested this is now an unlikely move.

Non-dom tax status

The term “non-dom” describes a UK resident whose permanent home – or domicile – for tax purposes is outside the UK. As a result, they do not pay UK tax on money they make elsewhere.

In the March Budget, the then-Chancellor Jeremy Hunt said non-dom tax status would be abolished, although there were some concessions.

Labour has said it wants to toughen the existing plans, although these plans might be reconsidered amid worries they could bring in less money than expected.

Gambling tax

Reports suggest the government is considering extra taxes on gambling companies – a rumour that led the shares of UK-based bookmakers to fall.

It is not clear how likely this is, with other commentary suggesting the Treasury is distancing itself from such a move.

Fuel duty

Fuel duty has not risen in more than a decade. It was frozen between 2012 and 2022, and cut by 5p in March 2022 when pump prices surged following Russia’s invasion of Ukraine.

However, some motoring groups argue the cut was never passed on to motorists and the RAC says it could be reversed

The Treasury, the government department in charge of the economy and public spending, publishes a report alongside the Budget speech. It gives more details about the measures announced and what they will cost.

The independent Office for Budget Responsibility (OBR), which monitors government spending, also produces an independent assessment of the health of the UK economy.

MPs will spend several days debating the plans. They are then asked to approve the proposals and the government introduces a Finance Bill to turn the Budget announcements into law.