What Rachel Reeves has announced – the Budget at a glance

CHANCELLOR Rachel Reeves has delivered her second Budget, laying out a series of tax rises as she aims to fill a black hole in the public finances.

- DAVID LYNCH

Ms Reeves also announced a series of measures aimed at helping people who are currently struggling with living costs, including a long-expected end to the two-child limit on benefits.

The Chancellor was gazumped in laying out her Budget by the unexpected early publication of the Office for Budget Responsibility (OBR) analysis of her plans.

Here are the key tax rises and cost-of-living measures the Chancellor announced at the Budget yesterday.

Economic growth

The OBR has increased its forecast for economic growth this year from 1% to 1.5% but downgraded its forecasts for the following four years.

Growth has been downgraded in 2026 from 1.9% to 1.4%, in 2027 from 1.8% to 1.5%, in 2028 from 1.7% to 1.5% and in 2029 from 1.8% to 1.5%.

Fiscal headroom

The amount of headroom the Chancellor has against economic shocks has been raised by tax hikes in the Budget, according to the OBR.

Ms Reeves claimed in the Commons she would “more than double” the fiscal headroom.

The leeway the Government has against the Chancellor's day-to-day spending rule will widen to £22 billion in 2029-30, £12 billion more than in March, the Budget watchdog said.

In future, the Chancellor will ask the OBR to assess whether she is meeting her fiscal rules just once a year, in the autumn Budget, rather than twice a year.

Income tax thresholds

The Chancellor will extend a freeze of income tax thresholds until 2030, a move previously described as a “stealth” tax rise, but which Ms Reeves billed as “asking everyone to make a contribution”.

This will drag more people into paying the tax for the first time, and others into paying a higher rate as wages rise.