Chancellor John Healey Prepares First Budget Amid Tax Pressure
Chancellor John Healey is drafting an October 28 budget focused on bank tax hikes and energy support while rejecting increases to capital gains tax.
Chancellor of the Exchequer John Healey is preparing to deliver his first budget on October 28, balancing a cost-of-living crisis and high borrowing costs linked to the Iran war. Healey intends to provide breathing space for consumers and small businesses without increasing borrowing or altering capital gains tax, despite lobbying from some Labour figures to align the latter with income tax.
Proposed measures include raising the bank surcharge to 8%, increasing machine games duty to 40%, and implementing a crackdown on overseas online marketplaces with turnovers exceeding £90,000. To support households, the government may introduce a £1.5 billion targeted energy support package and further details on the Your First Home scheme. Prime Minister Andy Burnham has additionally proposed cutting business rates for hospitality and retail and removing standing charges from gas bills.
Other fiscal developments include a high-value council tax surcharge for English properties valued at £2 million or more starting April 2028. Regarding pensions, a 3.9% increase next April will raise the full new state pension to £13,036. Pensions Minister Torsten Bell stated that individuals whose only income is the state pension and who only slightly exceed the personal allowance will not be required to pay tax. These plans face scrutiny from the Institute for Fiscal Studies, which warned that certain tax rises could hinder economic growth.
