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Wednesday 26 November 2025 12:58, UK
Here in Money we’ll focus on what it means for you – with a Q&A at 4.30pm featuring a panel of consumer experts and our own Money reporter Jess Sharp.
Submit your question above.
Drivers will pay more fuel duty from next September, according to the leaked Office for Budget Responsibility document.
Rachel Reeves will extend the 5p per litre cut for another year, before it is “reversed through a staggered approach”, it says.
The tax has been held at 57.95p since 2011, but the effective rate paid by drivers since 2022 has been 52.95p as a result of a “temporary” 5p cut introduced by the Conservatives and extended by Labour.
From April 2027, fuel duty rates will increase annually by the RPI measure of inflation, the document said. 
This would be the first rise in 16 years.
After facing immense pressure from Labour MPs and campaigners, Rachel Reeves has decided to scrap the two-child benefit cap. 
Getting rid of the cap means eligible parents will be able to claim the child-related element of universal credit for all their children from April 2026. 
This means you will be able to claim £292.18 a month for any child born after 6 April 2017. 
If your first child was born before that date, the universal credit you can claim is worth £339 a month. 
With the cap lifted, an eligible family with three children, all born after April 2017, should get £876.54 a month.
In a year, they would get around £3,500 for each child. 
What impact could lifting the cap have? 
Earlier this year, Child Poverty Action Group found 109 children were pulled into poverty each day by the cap, adding to the 4.8 million already in poverty. 
Estimates suggested that scrapping the cap could lift 350,000 children out of poverty and reduce the depth of poverty for a further 800,000 children.
A household is considered in relative poverty if it earns below 60% of the median income after housing costs.
How much is it going to cost? 
The Office for Budget Responsibility says the removal of the cap will cost £2.3bn in 2026-27 and £3bn in 2029-30. 
“This includes £300m by 2029-30 for the cost of an estimated 25,000 additional entitled families making a universal credit claim as a result of the increase in benefit generosity,” it adds. 
By James Sillars, business and economics reporter
It’s fair to say financial market sentiment towards the budget has turned – and not in a way Rachel Reeves would like to see.
We saw a brief jump in the pound and fall in bond yields – the interest rate demanded by investors to hold UK government bonds.
It was an early reaction to details of the budget released in error by the Office for Budget Responsibility (OBR).
We now have the pound down on the day against both the dollar and euro.
Crucially for the chancellor, those bond yields are also creeping up too.
A decline of five basis points on a 30-year bond has now been replaced by an increase of five basis points.
That was despite the OBR’s conclusions around the economy and public finances coming in more upbeat than had perhaps been expected.
It may be there are worries among investors over the effects this tax-raising budget will have on the economy.
The market reaction will continue to play out as this extraordinary day goes on.
The Money team is assessing what the leaks from the Office for Budget Responsibility mean for you.
The big picture emerging from the accidentally published document appears to be summed up in point 3.16, reading:
“Real household disposable income is lowered in [the] medium term by the rise in personal tax rises announced in this budget, which decreases household consumption significantly.”
The information comes from an OBR forecast based on announcements yet to be made by the chancellor.
Economics and data editor Ed Conway adds: “The big picture here is lots more taxes.”
“The tax burden is heading up much higher” than was anticipated based on the Labour manifesto, he says.
It could be the highest ever tax burden, Conway adds.
Keir Starmer had told political editor Beth Rigby that taxes on working people were too high in the run-up to the election.
National insurance will be charged on salary-sacrificed pension contributions above an annual £2,000 threshold from April 2029, raising £4.7bn, the Office for Budget Responsibility said.
What is salary sacrifice? 
Salary sacrifice schemes allow people to give up a chunk of their salary for a different benefit from their employer.
This could be for a company car, a cycle to work programme, childcare vouchers, healthcare or a pension. 
When you give up some of your salary, you do not pay income tax or national insurance on that amount, as it’s taken out of your gross salary before the taxes are calculated. 
This can help bring your overall tax bill down and boost your take-home pay. 
It’s helpful for your employer as well, as they don’t have to pay national insurance on the amount you sacrifice either. 
Some employers choose to add this saving to your pension as well. 
Income tax
The chancellor has frozen income tax thresholds for an additional three years, despite saying last year that to do so would “hurt working people”.
The Office for Budget Responsibility’s report on the chancellor’s budget has been released online earlier than planned. 
In it, the OBR analyses policies taken by Rachel Reeves. 
In the lengthy document, it says: “A set of personal tax changes which increase receipts by £14.9 billion in 2029-30, including: freezing personal tax and employer national insurance contributions (NICs) thresholds for three years from 2028-29, which raises £8bn.”
The report would normally only be released after the chancellor has finished outlining all the measures of the budget in front of MPs in the House of Commons.
But the full document is already available to read online now.
Two-child benefit cap
The two-child benefit cap will be scrapped in the budget, and this change will come into effect in April.
The cap is a measure that limits the amount of benefits larger families can receive, but charities have called for its removal and it is said doing so will lift millions of children out of poverty.
The report states: “The limit restricted the UC child element, which is currently £3,500 per year for second and subsequent children, to two children per family apart from children born prior to 6 April 2017 and those who meet certain exemption criteria. 
“Its removal costs £2.3bn in 2026- 27 and £3bn in 2029-30.
“This includes £300 million by 2029-30 for the cost of an estimated 25,000 additional entitled families making a UC claim as a result of the increase in benefit generosity.”
Mansion tax on properties worth £2m
The chancellor is introducing a mansion tax in the budget, the OBR has confirmed. 
Reeves will introduce a high value council tax surcharge on properties worth more than £2m.
This will raise £0.4bn, the OBR has confirmed.
Here in Money we’ll focus on what it means for you – with a Q&A at 4.30pm featuring a panel of consumer experts and our own Money reporter Jess Sharp.
Submit your question above.
As we await full details of the chancellor’s budget, one change has already been announced: the power for English mayors to introduce tourist taxes on overnight accommodation. How much could this raise for local councils?
Some local authorities across England, including Manchester, already levy charges on hotel stays. 
They implement this through local business fees, which has meant some short-term letting options like Airbnbs have escaped taxation.
The government’s new rules will allow cities to more easily impose fees on all types of short-term accommodations, putting the country in line with many of its European peers.
Many popular destinations for British tourists already levy a charge on short-term accommodation, including cities in Spain, Portugal, France, Switzerland and Germany.
Steve Reed, the housing secretary, said the policy would allow mayors to “put more money into local priorities, so they can keep driving growth and investing in these communities for years to come”.
London mayor Sadiq Khan said the change was “great news for London” and would “directly support London’s economy”, while Greater Manchester’s Andy Burnham said the tax would “help us sustain good growth over the next decade”.
Tees Valley’s mayor Lord Houchen had a different response: “There will be no tourist tax in Teesside, Darlington and Hartlepool for as long as I’m mayor. Thanks, but no thanks.”
So how much could it raise?
Data from the Office for National Statistics shows international visitors to England last year altogether stayed approximately nearly 250 million nights. 
With a £1-per-night tax, this could raise a corresponding £250m if applied everywhere across England.
If also applied to British tourists holidaying at home – and not just overseas ones – it could potentially raise millions more.
A Greater London area study estimated in 2017 that a £1-per-night tourist tax could raise up to £91m. 
The ONS’s more recent 2024 figures for overseas visitors suggests a tax could now raise more than £116m.
This, however, assumes visitor levels would remain the same after the introduction of a tourist tax.
Critics, including representatives from the hospitality industry, have said that introducing the levy could deter international visitors, contribute to inflation and discourage British families from holidaying at home.
Nonetheless, some academic studies have suggested little impact from the introduction of tourist taxes, including one from earlier this year studying the effects of the hotel charges in Manchester.
What about Scotland and Wales?
The announcement made by Reed yesterday only applies to England. 
Scotland and Wales both passed legislation earlier this year permitting their local authorities to levy tourist taxes.
In Wales, the levy will cost up to £1.30 per night and can be implemented by mayors after April 2027. 
In Scotland, Edinburgh has already announced a 5% levy on stays starting July 2026, with Glasgow and Aberdeen also intending to introduce a charge.
Let’s look at some more of your wishes for the budget. Hundreds of you have been getting in touch to let us know what you want Rachel Reeves to announce.
Reduce VAT on hospitality to fall more in line with the rest of Europe.
Unanimous
How on earth is the electric car per-mile charge going to work? It will fuel car clocking (easy on cars with electronic instrumentation), other mileage adjustments such as changing odometer, plain untrue disclosures and general dishonesty. This has really not been considered.
Cirendriver
I’d like us to stop squeezing higher earners tbh. The gap between the rich and the poor keeps growing because there’s no way for the poor to become rich. As soon as you hit £100k per year you are obliterated with tax and it makes escaping from that ceiling very difficult.
RH
I’m stuck in a tax trap where I’m the only household earner at £60k, with two children. If I earn any more I will have to repay ‘high income’ child benefit tax. This desperately needs to be increased with previous inflation and done on a household basis.
Luke
Why don’t we charge £10 entry requirement as other countries do? I recently went to Tortola and had to pay £10 (and it’s the BRITISH Virgin Islands). I’m also having to pay for a visa to go to my property in Spain which I pay Spanish tax on!
Carolbee
Among everyone’s very inventive suggestions, why am I not seeing the most obvious answer? Tax the rich. It is that simple. Stop punishing and penalising the working class, demonising anyone in society with low income, as if it’s their fault we’re in this mess. Tax. The. Rich.
lostallhope
I would like to see the new and old pensions joined so the gap doesn’t get bigger with percentage increases.
Charles M
Why don’t we increase the tax brackets. £15k tax free then £72k 40%.
The fluffy ears
Everyone should be given NHS credits. After the credits are gone, you pay a fifth of the price.
Cut the fat
I’m quite worried by the suggestion that GP appointments should cost £10 – this seems like an unfair penalty on people who have health issues and will absolutely hit women harder than men!
SWalker
The triple lock needs to go. It’s achieved its original goal of lowering pensioner poverty – the people who need the most support now are young families and first-time buyers!
Kalin
How about a tax on big lottery wins – say 10% on anything over a million. You are still a winner and never ever broke into a sweat to earn the money.
Good moaning
Add 2p on to income tax rather than all of these adjustments which are penalising all the wrong people. Don’t lift the two child cap. Don’t get rid of salary sacrifice – people aren’t saving enough already for pensions, let alone the gender gap – I’m 37-year-old woman on £30k.
Dalton
Pensioners with house equity. Government to offer to buy houses with guarantee of agreed remain in home, provide social care and inheritance tax advantages for family inheritance.
SteveCornwall
Give tax relief to hospitality. Reduce the tax burden on beer in pubs and move that burden to supermarkets. Don’t shut down employment opportunities for young people in this sector by making the minimum wage too high for employers to take on additional/keep existing staff.
Lee W
Lower corporation tax to encourage investment and businesses to come to UK. Just look at Ireland, 12.5% corporation tax and getting 3.6% growth. More investment means more jobs means more tax. Lower stamp duty to stimulate the housing market. More sales, more tax.
DeanNewForest
Make it a legal requirement that everyone gets a pay rise, including uplift to state benefits, in April, that equals CPI figure as at 31 December. Scrap the triple lock, as it’s no longer necessary.
Andy
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