Budget 2025: What Rachel Reeves’ Plans Mean For Sussex

Chancellor Rachel Reeves has delivered the government’s Budget this afternoon (Wednesday 26 November), unveiling a wide range of tax rises, cost-of-living support and investment pledges that will affect residents and businesses across Sussex.

Here are the key points from today's announcement.

Tax and Income Measures

• Tax thresholds frozen until 2028, meaning more people could enter higher tax bands — raising £8bn.

• Higher taxes on gambling companies, including a jump in remote gaming duty from 21% to 40% and online betting tax rising from 15% to 25%. Bingo tax will be abolished.

• Mileage tax introduced for electric vehicles: 3p per mile for EVs and 1.5p per mile for plug-in hybrids, raising £1.4bn.

• Dividend, property and savings tax rates increased by 2 percentage points.

• Inheritance tax allowances frozen.

• Mansion tax for properties over £2m, with charges up to £7,500.

Cost-of-Living and Welfare

• Two-child benefit cap scrapped from April 2026, which the government says could help lift 450,000 children out of poverty.

• Energy bills to fall by £150 from April.

• State pensions boosted by up to £575 a year.

• Fuel duty frozen until next September.

• Minimum wage rising to £12.71 for over-21s and £10.85 for 18–20s.

Savings, Students and Pensions

• Cash ISAs capped at £12,000 from next tax year — except for over-65s who keep the £20,000 limit.

• Student loan repayment threshold frozen for three years.

• Salary-sacrifice pension contributions above £2,000 to face National Insurance from 2029.

Transport and Everyday Costs

• Rail fares frozen nationwide for the first time in 30 years — welcome news for Sussex commuters.

• Ride-hailing journeys on apps like Uber and Bolt will now be taxed.

• Luxury vehicles removed from the Motability scheme.

Business and Local Economy

• Business rates cut for 750,000 companies in retail, hospitality and leisure — though funded by higher bills for premises worth over £500,000, including large warehouses used by online retailers.

• Stamp duty break for companies newly listing on the London Stock Exchange for the next three years.

Growth Outlook and Public Spending

The OBR now expects the UK economy to grow by 1.4% next year — lower than previously forecast — and inflation of 3.5% this year, easing to 2.5% in 2026.

Other announcements include:

• £300m investment in NHS technology and 250 new neighbourhood health centres by 2030.

• Defence spending set at 2.6% of GDP.

• Extra funding for devolved governments and £13bn flexible funding for regional mayors to support skills, infrastructure and business growth.