Inflation has taken a surprise fall to 2.5% in the UK, which may ease the pressure on Chancellor of the Exchequer, Rachel Reeves.
This comes after Chancellor Reeves refused to rule out the possibility of an emergency budget.
Despite this fall, the consumer price index figure is still above the Bank of England’s 2% Target, meaning a higher cost for borrowers.
Chancellor Reeves delivered the Autumn Budget on the 30th of October 2024 this included the following:
Tax Changes
• Businesses set to pay more national insurance: NI is set to rise by 1.2 percentage points to 15% in April 2025 with the threshold for payments decreasing from £9,100 to £5,000
• Higher tax for people buying their second property.
• Wealth Tax: Rich People will pay more on capital gain.
Support for Workers
• Minimum wage will increase to £12.21 per hour for employees aged 21 and over.
• No extra tax on fuel this year.
• No new increases or freezes on income tax beyond 2027.
Investment in services
• NHS: Funding boost for hospitals and equipment.
• More money for rebuilding schools and general education buildings.
• A focus on improving train links and committing to the HS2 rail link.
• Money invested to build homes and improve the safety of existing ones.
Economy goals
• Inflation is expected to come down steadily over the next few years
• The government plans to borrow less money by cutting waste and raising taxes for the wealthy.
Ms Reeves position as Chancellor was questioned at a press conference in London, but the Prime Minister Keir Starmer said he had confidence in her.
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