Major Budget Leak Reveals Tax Plans
A significant leak from the Office for Budget Responsibility has revealed Chancellor Rachel Reeves's Budget measures hours before her scheduled Commons speech. The document, published on the OBR website before the 12:30pm Wednesday announcement, outlines a comprehensive package of tax changes designed to address public finances.
Key Tax Measures Unveiled
The leaked information details nine major fiscal announcements. Personal tax and employer National Insurance contributions thresholds will be frozen for three years from 2028-29, generating an estimated £8.0 billion in revenue.
Additional measures include charging NICs on salary-sacrificed pensions contributions, raising £4.7 billion, and increasing tax rates on dividends, property and savings income by 2 percentage points, expected to generate £2.1 billion.
Business and Environmental Taxes
The corporation tax system faces changes with a reduction to the writing down allowance main rate, projected to raise £1.5 billion. From April 2028, a new mileage-based charge will apply to battery electric and plug-in hybrid cars, contributing £1.4 billion to Treasury coffers.
Other significant measures include reforms to gambling taxation (£1.1 billion), reduced capital gains tax relief on disposals to employee ownership trusts (£0.9 billion), and a high value council tax surcharge on properties worth over £2 million (£0.4 billion).
The government will implement a five-month freeze on fuel duty followed by staged increases from September 2026, costing £2.4 billion next year and £0.9 billion annually thereafter.
Budget Headroom and Market Reaction
According to OBR figures, these measures would create £22 billion of headroom within five years. The unexpected early release of the document initially caused government bond yields to fall as investors responded positively to the increased fiscal space.
Alongside these tax measures, the Chancellor is expected to announce the lifting of the two-child limit on benefits. The government faces intense pressure to stabilise public finances while navigating economic challenges.
