Chancellor Rachel Reeves has confirmed a decision against raising income tax rates in the forthcoming Budget. This announcement follows earlier indications that such a measure was being considered.
The decision aligns with Labour's 2024 general election manifesto commitment, which explicitly pledges not to increase the basic, higher, or additional rates of income tax, National Insurance, or VAT, thereby aiming to avoid increasing taxes on working people.
While direct increases to income tax rates are foregone, the Chancellor could still opt to freeze or lower income tax and National Insurance thresholds. Implementing such a freeze or reduction, though not a direct breach of the manifesto's promise regarding tax rates, could lead to increased tax payments for some individuals as they are pulled into higher tax brackets or begin paying tax.
Source: https://www.bbc.com/news/articles/c0mx3nv7zy8o?at_medium=RSS&at_campaign=rss