Chancellor Rachel Reeves tells the BBC she would not want to repeat the £40bn tax rise Budget and she wants faster growth than has been forecast by the Office for Budget Responsibility (OBR)
Employers will bear the brunt of the £40bn in tax rises unveiled earlier by Reeves - the biggest increase in a generation
The OBR, which assesses the health of the UK's economy, said the package of economic measures unveiled by Reeves would ultimately "leave GDP largely unchanged in five years" - read the key announcements here
Analysis: This is what you might call a kitchen-sink Budget, which includes one of the biggest single tax-raising measures in history, writes economics editor Faisal Islam
On spending, Reeves announces a £22.6bn increase in the "day-to-day health budget" for the NHS and £5bn in house building investment
Reacting to the Budget, Tory leader Rishi Sunak calls it "an enormous borrowing spree" which contains "broken promise after broken promise"
Chancellor says Budget will raise taxes by £40bn
The chancellor now says the government will increase funding significantly for local governments next year.
Reeves adds that Greater Manchester and the West Midlands will be the first mayoral authorities to receive integrated settlements from next year.
She says it will give mayors "meaningful control of the funding for their local areas".
Reeves announces a £2.9bn increase to the Ministry of Defence's budget next year.
She also pledges guaranteed military support to Ukraine of £3bn a year for "as long as it takes".
Funding will be allocated for the 80th anniversary of VE and VJ days in 2026 to honour those who "have served at home and abroad", she adds.
There will be no return to austerity, Reeves says.
“But given the scale of the challenge we face in our public services” there will still be hard decisions to come.
She then turns to education, saying that investment into breakfast clubs will be tripled. There will also be a £2.3bn increase to the core school’s budget to ensure hiring of teachers into key subjects.
There will be an additional £300m for further education, Reeves adds.
Reeves: No extension of income tax and NI freeze
There will be no extension of the freeze in income tax and National Insurance thresholds beyond the decisions of the previous government, Reeves says.
From 2028-29, personal tax thresholds will be uprated in line with inflation, she says.
Reeves says that 94% of children in the country attend state schools.
She says she will introduce VAT on private school fees from January 2025, and that the government will soon introduce legislation to remove their business rates relief from April 2025.
The chancellor says she will increase the windfall tax on oil and gas profits to 38%, which will now expire in March 2030.
Reeves adds that the government will remove the 29% investment allowance.
To ensure the oil and gas industry can protect jobs and support our energy security, we will maintain the 100% first year allowances and the decarbonisation allowance too, she adds.
Reeves announces the government will increase the stamp duty land surcharge for second-homes, by 2% to 5% from tomorrow, Reeves says.
Reeves says she will increase Capital Gains Tax rates on carried interest to 32% from April 2025 and, from April 2026, deliver further reforms.
Dearbail Jordan
Business reporter
For a moment there it looked like Reeves was going to raise fuel duty - but motorists and businesses can breathe easy.
If she had decided to reverse the existing 5p per litre cut and let petrol and diesel duty rise in line with inflation it would have raised £3bn.
But she's holding off.
Image source, PA MediaReeves says she will abolish the non-dom tax regime and remove the "outdated concept" of domicile from the tax system from April 2025.
This applies to a UK resident whose permanent home - or domicile - for tax purposes is outside the UK. It means they do not pay UK tax on money they make elsewhere in the world.
She says she will introduce a new, residence-based scheme with "internationally competitive arrangements" for those coming to the UK on a temporary basis.
The Office for Budget Responsibility says this package of measures will raise £12.7bn over the next five years, she says.
Reeves now announces she will be cutting duty on draft alcohol - to loud cheers from MPs.
"Which means a penny off the pints at the pubs," the chancellor says.
Alcohol duty rates on non-draught products will increase in line with RPI from February next year.
Reeves turns now to air passenger duty.
She says it has not kept up with inflation, so they are introducing an increase of no more than £2 for an economy-class short haul flight.
But on private jets, she is increasing the rate of air passenger duty by a further 50% - equivalent to £450 per passenger for a private jet, "to say, California?" she jokes, in an indirect reference to Sunak.
Reeves says Labour wants to support take-up of electric vehicles.
The Budget will maintain existing incentives for EVs in company car tax from 2028. It will also increase the differential between fully electric and other vehicles in the first rates of Vehicle Excise Duty beginning in April 2025, she says.
The measure is forecast to raise about £400m by the end of the forecast period, she adds.
Reeves says the government will renew the tobacco duty escalator which means that taxes will rise by the Retail Price Index (RPI) measure of inflation as well as 2%.
In addition, she will increase duty by 10% on hand-rolled tobacco this year, introduce a flat-rate duty on all vaping liquid from 2026, and a one-off increase in tobacco duty to maintain the incentive for smokers to give up smoking.
Reeves says she will extend the inheritance tax threshold freeze for a further two years to 2030.
That means the first £325,000 of any estate can be inherited tax-free, rising to £500,000 if the estate includes a residence passed to direct descendants, and £1m when a tax free allowance is passed to a surviving spouse or civil partner, she says.
She says she will bring inherited pensions into inheritance tax from April 2027, she says, adding she will reform Agricultural Property Relief and Business Property Relief.
From April 2026, the first £1m of combined business and agricultural assets will continue to attract no inheritance tax at all, but for assets over £1m, inheritance tax will apply with 50% relief, at an effective rate of 20%, she says.
Jack Fenwick
Political reporter
The chancellor has scrapped a controversial arrangement that saw the government receive hundreds of millions of pounds from a pension scheme for mineworkers.
The government had been entitled to half the surplus cash from the scheme under an agreement signed 30 years ago.
It’s understood the change will see a total of around £1.5bn transferred into the pension pots of 112,000 former coalminers.
Announcing the news in today’s Budget, Rachel Reeves says it would mean “working people who powered our country receive the fair pension they are owed".
In May, the BBC revealed that more than £420m from the scheme had flowed into the government’s coffers in the previous three years.
Dearbail Jordan
Business reporter
As widely expected, the chancellor has lifted employers' National Insurance Contributions, but the drop in the threshold at which businesses start paying it is pretty startling - from £9,100 to £5,000.
It will raise £25bn, she says.
"I know that this is a difficult choice," Reeves adds. "I do not take this decision lightly".
However, businesses will have a lot to say about this.
Reeves tells the Commons that capital gains tax (CGT) will increase.
This tax is charged on profits which are made from selling assets such as a second home or investments, including shares.
The lower rate of Capital Gains Tax will rise from from 10% to 18%, and the higher rate from 20% to 24%, she says.
The rates on residential property will remain at 18% and 24%.
Reeves says she is increasing Employment Allowance to help smaller businesses.
The Employment Allowance will increase from £5,000 to £10,500, which the chancellor says will mean 865,000 employers won’t pay any National Insurance at all next year.
She adds over one million will pay the same or less as they did previously.
Simon Jack
Business editor
The cost of government borrowing fell after the chancellor promised to balance the books early, with the OBR forecasting that the government would spend less than it gathers in tax by 2027.