When is the Budget and what might be in it?
- Published
The Chancellor Rachel Reeves will set out her plans for the economy when she delivers the Budget on 26 November.
Before the 2024 general election, Labour promised not to increase income tax, National Insurance or VAT for working people.
But in her speech at the Labour Party Conference in September, Reeves appeared to suggest tax rises were a possibility, talking of tough decisions "in the coming months".
What is the Budget?
The chancellor of the exchequer's Budget statement outlines the government's plans for raising or lowering taxes.
It also includes big decisions about spending on health, schools, police and other public services.
The statement is made to MPs in the House of Commons.
Further details about Budget measures - and what they cost - are published by the Treasury, the government's economic and finance ministry.
The independent Office for Budget Responsibility (OBR), which monitors government spending, also publishes its assessment of the health of the UK economy and a forecast of what it thinks will happen in the future.
What time is the Budget and what happens afterwards?
The Budget speech usually starts at about 12:30 UK time - after Prime Minister's Questions - and lasts for about an hour.
It will be broadcast live on the BBC iPlayer and on the BBC News website.
The Leader of the Opposition, Conservative MP Kemi Badenoch, will respond to the speech in the House of Commons.
MPs will then debate the measures for four days, before voting on them.
If approved by MPs, tax changes can come into effect immediately. However, the government must pass a finance bill to make them permanent.
What might be in the Budget?
There is lots of speculation that Reeves will have to break Labour's manifesto promise and raise taxes in the Budget because she needs more money to meet her self-imposed rules for government finances.
Reeves has two main "fiscal" rules, which she says are "non-negotiable":
Not to borrow to fund day-to-day public spending by the end of this parliament
To get government debt falling as a share of national income by the end of this parliament
However, in its last report in March, external, the OBR said the chancellor only had a £10bn buffer to meet these rules, which it called a "very small margin".
Since then the government has U-turned on planned benefit cuts that had aimed to save billions, while the cost of government borrowing has increased.
Income Tax and National Insurance
The government could extend the current freeze on income tax thresholds, which is due to end in 2028.
Freezing the thresholds means that, as salaries rise over time, more people reach an income level at which they start paying tax or qualify for higher rates. This is often referred to as a "stealth tax".
Speaking to the BBC in September, Reeves did not rule out extending the freeze.
The Resolution Foundation think tank - which has close links to some members of the government - says some personal taxes will have to rise.
As part of a package of measures, it recommended cutting 2p from the employee NI rate while adding the same amount to income tax. , external
Such a move would potentially affect pensioners, landlords and the self-employed more than workers, as their tax would increase but they don't pay that rate of NI so wouldn't benefit from the matched cut.
Value Added Tax (VAT)
The Sunday Times reported, external that the government was considering scrapping VAT on domestic fuel bills - cutting the current 5% rate to zero.
Health Secretary Wes Streeting ruled out introducing VAT on private healthcare.
Property taxes
Reports suggest the government may reform property taxes. This could include replacing stamp duty - a tax buyers pay on properties above a certain value in England and Northern Ireland - with a property tax.
Landlords could have to pay more taxes, and council tax could be replaced.
Some people selling their main residence may have to pay capital gains tax (CGT).
Youth employment guarantee
In September Reeves said that young people who have been out of work for 18 months will be given paid placements to help them secure full-time employment. More details are expected in the Budget.
Isa reform
In July, the chancellor ruled out any immediate reform to cash Isas (Individual Savings Accounts). There had been speculation that she wanted to reduce the annual allowance to push people into investing in shares instead, to help boost economic growth.
Other measures to encourage such investment are considered more likely.
Pension changes
There has also been speculation about possible changes to pension rules, such as the level of tax relief available to savers and the size of the cash lump sum which can be withdrawn.
Cutting the higher rate tax relief on pension contributions would save the Treasury money, but may make pension savings less attractive.
Business taxes
The TUC, the umbrella group for trade unions in the UK, has called for higher taxes on online gaming companies and on banks' profits.
How is the UK economy doing?
The Labour government has repeatedly said that boosting the economy is a key priority.
A growing economy usually means people spend more, extra jobs are created, more tax is paid and workers get better pay rises.
The latest official figures show that growth in the UK economy has slowed in recent months. The economy was flat in July, after increasing by 0.4% in June.
Looking at the longer term trend, the economy grew by 0.2% in the three months to July, down from the 0.3% growth in the three months to June, and the 0.6% growth seen between March and May.
In August, UK government borrowing - the difference between public spending and tax income - hit £18bn, the highest level seen for the month in five years, driven by higher spending on public services, benefits and debt interest.
Meanwhile prices in the shops are still rising faster than wanted.
Inflation - the rate at which prices rise - was 3.8% in the year to August, the same as in July, which is above the Bank of England's 2% target.
In August the Bank cut interest rates for the fifth time in a year, taking the cost of borrowing to the lowest level for more than two years.
It cut because of concerns that the jobs market was weakening, with data showing job vacancies were continuing to fall and wage growth was slowing.
However, the Bank held rates at its next meeting in September, arguing the UK was "not out of the woods" on inflation.
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