Five key developments from the budget you may have missed

Labour's first budget in almost 15 years was wide-reaching in scope, here's five things you should know about it.

Connor Parker
Updated ·4 min read
Rachel Reeves presented her budget on Wednesday. (PA)
Rachel Reeves presented her budget on Wednesday. (PA)

Rachel Reeves presented Labour's first budget in almost 15 years on Wednesday, bringing in £40bn of tax rises and promising to spur growth in the UK.

The budget was sweeping in its changes with over £70bn of investment and numerous changes to taxes. The biggest money raiser was the hiking to 15% for employer national insurance contributions, expected to raise over £20bn.

The chancellor has defended the tax rises as necessary to plug funding gaps she claims were left by the Conservatives, but she also admitted the tax hike will likely lower pay rises for employees in the future.

But beyond the headline tax raise Reeves announced numerous small and large changes to the way the UK functions, here Yahoo News lays out some of the biggest changes you should be aware of.

Read more from our media partners below or click to skip ahead

> Lower pay rises likely due to Budget tax rises, Reeves admits

> Mortgage rates to rise after Budget, says OBR

> Jeremy Clarkson slams 'hopeless' budget for 'shafting' farmers

> Hairdresser cries during TV interview: ‘Our industry is done’

> UK’s borrowing costs rise amid high interest fears

It was the first Labour budget in almost 15 years. (AP)
It was the first Labour budget in almost 15 years. (AP)

Tax rises in the Budget are likely to hit workers in the pocket with lower pay rises, Rachel Reeves has admitted.

The chancellor acknowledged her decision to raise national insurance contributions (NIC) for employers could impact wage growth for private sector workers, or companies will have to absorb costs.

Reeves also said she did not want to repeat the £40 billion tax rises she implemented in her first Budget “ever again”. Choices made by Reeves will see the overall tax burden reach a record 38.3% of gross domestic product (GDP) in 2027-28, the highest since 1948.

The OBR warned interest rates may not come down as quickly as expected due to the budget spending. (Getty)
The OBR warned interest rates may not come down as quickly as expected due to the budget spending. (Getty)

Mortgage rates will rise ... after Rachel Reeves tax, borrow and spend Budget, according to the official forecaster.

Detailed analysis by the Office for Budget Responsibility showed it now expects mortgage rates to be higher than its predictions in the spring. The 198-page analysis by the OBR states: “Average interest rates on the stock of mortgages are expected to rise from around 3.7 per cent in 2024 to a peak of 4½ per cent in 2027, then remain around that level until the end of the forecast.”

Jeremy Clarkson has become a big name in British farming. (PA)
Jeremy Clarkson has become a big name in British farming. (PA)

Jeremy Clarkson has slammed the Budget as "hopeless," saying it leaves farmers feeling "shafted."

The former Top Gear host, who has become a voice for farmers through his hit Prime Video series Clarkson’s Farm, hit out over Chancellor Rachel Reeves' decision to extend inheritance tax to family farms. She announced agricultural property relief was being abolished, claiming it was increasingly being used by the very wealthy to protect their assets from tax.

Hair salon owners like Toby Dicker will face higher costs to employ hairdressers. (PA)
Hair salon owners like Toby Dicker will face higher costs to employ hairdressers. (PA)

A hairdresser broke down in tears during a live television interview over the hike in national insurance announced in Labour’s historic budget.

Toby Dicker, founder of the Salon Employers Association, said he was “shell-shocked” following chancellor Rachel Reeves’ announcement that employers’ national insurance will rise by 1.2 percent.

In an interview with Sky News, Mr Dicker fought back tears as he said: “It is much worse than we ever thought it could be.

Read the full story from the Independent

The Bank of England decides interest rates. (PA)
The Bank of England decides interest rates. (PA)

UK government borrowing costs have risen to their highest level this year as City investors bet Rachel Reeves’s budget would lead the Bank of England to adopt a more cautious approach to cutting interest rates.

The yield – in effect the interest rate – on benchmark 10-year UK government bonds rose by more than 0.15 percentage points to trade above 4.5% on Thursday, before falling back slightly, as financial markets reacted to Labour’s first budget in 14 years.

Latest Stories