LIVE Budget 2024 live: Biggest ever tax rise hits growth
Rachel Reeves’s £40bn of tax rises will weaken long-term growth in Britain’s economy, the Office for Budget Responsibility (OBR) has warned.
The official forecaster said the economy is expected to grow by just over 1pc this year, rising to 2pc in 2025, before falling to around 1.5pc.
This is “below its estimated potential growth rate” of 1.66pc, over the remainder of the forecast.
In the first Budget by a Labour government in 14 years, the Chancellor said she will increase National Insurance contributions for employers by 1.2 percentage points to 15pc from April, raising £25bn.
She said: “I know that this is a difficult choice. I do not take this decision lightly.”
Ms Reeves also ramped up the lower rate of capital gains tax from 10pc to 18pc, and the higher rate from 20pc to 24pc, while maintaining the rates of capital gains tax on residential property at 18pc and 24pc.
Turning to inheritance tax, Ms Reeves said she would extend the freeze on thresholds for a further two years until 2030.
The Chancellor said the Tories had failed to budget for the cost of compensation for the infected blood and Post Office Horizon scandals.
She said: “The black hole in our public finances this year, which recurs every year, the compensation payments which they did not fund and their failure to assess the scale of the challenges facing our public services means this budget raises taxes by £40bn.”
The Chancellor announced an extra £22.6bn will be allocated to the day-to-day health budget while £3.1bn will be given for capital investment.
In a boost for motorists, fuel duty will remain frozen for the next two years.
She also confirmed that the National Living Wage will be increased by an inflation-busting 6.7pc to £12.21 an hour, adding that the Government will move towards a single adult rate for the minimum wage.
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“He clarified his comments, but let me clear: I strongly disagree with any criticism of people based on who they vote for,” she told reporters.
“I believe that the work that I do is about representing all the people whether they support me or not… I will be a president for all Americans whether they vote for me or not.”
Responding to a speaker at a Trump rally who called Puerto Rico a “floating pile of garbage”, Mr Biden said on a campaign call last night: “The only garbage I see floating out there is his supporters.”
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Two women were reportedly ejected from a flight at Heathrow Airport after a flight broke out over a “Make America Great Again” cap.
The American passengers were embroiled in an argument in the queue for a British Airways flight to Texas from Heathrow’s Terminal 5, The Sun reported.
One of the women was reportedly wearing a red “MAGA” cap, worn by supporters of Donald Trump, days before the US presidential election on Nov 5.
Punches were exchanged between the two women once they had boarded the flight, and police were called by the plane’s captain, according to the newspaper report.
Both women were then removed from the plane, causing a two-hour delay for other passengers.
The flight was scheduled for departure at 12.10pm, but left Heathrow at 2.11pm.
The Metropolitan Police, which is investigating the incident, said that two women, one in her 40s and another in her 60s, made “counter allegations of affray”.
“Shortly after 12.45pm on Monday, 28 October, police at Heathrow were made aware of an incident involving two women waiting to board a plane in Terminal 5,” a spokesman said.
A source at the airline told The Sun: “With the US presidential election so close, tensions are sky high. Airline crew could not run the risk of a full-scale punch-up at 30,000ft.
“BA officials cannot recall a flight being delayed before due to a passenger’s baseball cap. It was extraordinary.”
A British Airways spokesman said: “We apologised to our customers for the delay and got them on the way as quickly as possible.”
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Narendra Modi’s right-hand man has been accused of personally authorising the assassination of a Sikh dissident in Canada.
Ottawa had previously stated that the targeting and killing of Sikh activists on Canadian soil could be traced back to the “highest levels of the Indian government”.
But David Morrison, Canada’s deputy foreign minister, said under oath on Tuesday that he believed Amit Shah, India’s home minister, had authorised a wave of violence against Sikh separatists.
That included the assassination of the Sikh leader Hardeep Singh Nijjar, who was shot dead outside a Sikh temple in British Columbia in June 2023 – sparking an ongoing diplomatic row between India and Canada.
Mr Morrison’s claims threaten to further deteriorate the relationship between New Delhi and Ottawa given Mr Shah’s significance in Mr Modi’s administration.
Mr Shah and Mr Modi first met in 1982 in Ahmedabad, where the two bonded in their roles within the Right-wing Hindu Rashtriya Swayamsevak Sangh (RSS) party.
Supporters have described the pair as “two wheels of a car” and three decades on from their first meeting, Mr Shah, a Hindu nationalist, is seen as Mr Modi’s most trusted lieutenant.
He is widely considered to have orchestrated the Bharatiya Janata Party’s three national election victories, as well as a number of state wins.
Ten years ago, Mr Shah engineered a victory in Uttar Pradesh, a state that had previously been seen as unattainable for the Bharatiya Janata Party. And in 2019, he led the party to a second, even bigger landslide.
Justin Trudeau, Canada’s prime minister, first accused India of being involved in the killing of Mr Nijjar in Sept 2023.
Two days later, Sukhdool Singh Gill, a Sikh activist, was shot and killed in Winnipeg. Mr Morrison has confirmed he believes Mr Shah personally authorised the killing.
‘Criminal activities’
India, which has rejected any involvement in the killings, had branded Mr Nijjar as a “terrorist” and accused him of leading a militant separatist group, which his supporters denied.
In a press conference on Oct 14, Canadian police accused India’s ambassador and senior diplomats of engaging in “criminal activities” in Canada. This included homicides, extortion, intimidation and harassment, primarily against members of the Indian Sikh diaspora.
Officials also alleged that there was evidence showing India was involved in the killing of three people, including Mr Nijjar.
The accusations have sparked a series of tit-for-tat diplomatic expulsions from each other’s country.
Mr Morrison said on Tuesday that he had leaked sensitive information to the Washington Post, which included his belief that Mr Shah had authorised violence against Sikh activists in Canada.
‘Sharing confidential information’
India has not responded to the claims, although Reuters reported on Wednesday that government officials had rejected the accusation.
Nathalie Drouin, Mr Trudeau’s national security adviser, also admitted to leaking sensitive information to the publication about India’s alleged role in the violence on Canadian soil.
Ms Drouin has said Mr Trudeau did not give the go-ahead to leak the information and that no classified intelligence was shared.
Ashok Sajjanhar, a former Indian diplomat, told The Telegraph that the accusations against Mr Shah “further strengthens” India’s claim that Mr Trudeau is capitalising on the deaths for political capital.
“If Mr Trudeau had wanted to get to the bottom of this whole issue … he would have come to India with the most serious intent to find what was behind it, rather than going to journalists sharing confidential information with them,” he said.
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One of few surprises in this Budget was that it took the Chancellor 80 minutes to say what could have been boiled down to a single sentence: I am taking lots of money from business, small business in particular, and handing it over to the NHS…