Hitchin in Hertfordshire does well in the polls.

On the edge of the Chilterns and 30 minutes from central London by train, it’s Britain’s most expensive market town for first-time buyers. It’s also been voted one of the top 10 best, and top 20 happiest, places to live in the country.

Last summer Labour did well in the polls here too. Hitchin’s 35,000 inhabitants, with above average earnings, levels of employment, and higher education, ejected the Conservatives for the first time in more than 50 years.

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Having swept into affluent southern constituencies, Rachel Reeves is now asking them to help pay for her plans via a combination of increased taxes on earnings and savings.

While her first budget made business bear the brunt of tax rises, the higher earners of Hitchin, and those aspiring to join them, are unapologetically in the sights of the second.

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Kai Walker, 27, runs Vantage Plumbing & Heating, a growing business employing seven engineers, all earning north of £45,000, with ambition to expand further.

He’s disappointed that the VAT threshold was not reduced – “it makes us 20% less competitive than smaller players” – and does not love the prospect of his fiancee paying per-mile to use her EV.

But it’s the freeze on income tax thresholds that will hit him and his employees hardest, inevitably dragging some into the 40% bracket, and taking more from those already there.

“It seems like the same thing year on end,” he says. “Work harder, pay more tax, the thresholds have been frozen again until 2031, so it’s just a case where we see less of our money. Tax the rich has been a thing for a while or, you know, but I still don’t think that it’s fair.

“I think with a lot of us working class, it’s just a case of dealing with the cost. Obviously, we hope for change and lower taxes and stuff, but ultimately it’s a case of we do what we’re told.”

Reeves’s central pitch is that taxes need to rise to reset the public finances, support the NHS, and fund welfare increases she had promised to cut.

In Hitchin’s Market Square it has been heard, but it is strikingly hard to find people who think this budget was for them.

Jamie and Adele Hughes both work, had their first child three weeks ago, and are unconvinced.

“We’re going to be paying more, while other people are going to be getting more money and they’re not going to be working. I don’t think it’s fair,” says Adele.

Jamie adds: “If you’re from a generation where you’re trying to do well for yourself, trying to do things which were once possible for everybody, which are not possible for everybody now, like buying a house, starting a family like we just have, it’s extremely difficult,” says Jamie.

Liz Felstead, managing director of recruitment company Essential Results, fears the increase in the minimum wage will hit young people’s prospects hard.

“It’s disincentivising employers to hire younger people. If you have a choice between someone with five years experience or someone with none, and it’s only £2,000 difference, you are going to choose the experience.”

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After five years, the cost of living crisis has not entirely passed Hitchin by. In the market Kim’s World of Toys sells immaculately reconditioned and repackaged toys at a fraction of the price.

Demand belies Hitchin’s reputation. “The way that it was received was a surprise to us I think, particularly because it’s a predominantly affluent area,” says Kim. “We weren’t sure whether that would work but actually the opposite was true. Some of the affluent people are struggling as well as those on lower incomes.”

Customer Joanne Levy, shopping for grandchildren, urges more compassion for those who will benefit from Reeves’s spending plans: “The elderly, they’re struggling, bless them, the sick, people with young children, they are all struggling, even if they’re working they are struggling.”

Rachel Reeves will face further questions this morning after being accused of presiding over a manifesto-busting budget that rose taxes by £26bn.

The chancellor has acknowledged she is “asking ordinary people to pay a little bit more” following her series of announcements yesterday, including extending the freeze on income tax bands.

But when challenged by Sky News political editor Beth Rigby that this amounted to a breach of Labour’s manifesto, she argued it didn’t because the rates themselves had not changed.

Ms Reeves said the party’s election document was “very clear” about not raising the rates of income tax, national insurance, and VAT.

But she added: “If you’re asking does this have a cost for working people? I acknowledge it does.”

The chancellor – who will be questioned on Mornings With Ridge And Frost from 7am – is set to inflict a record tax burden upon Britain.

Her other measures include:

• A “mansion tax” on properties worth over £2m;

• New taxes on the gambling industry to raise more than £1bn;

• A new mileage tax for electric vehicles from April 2028;

• Slashing the amount you can save in a tax-free cash ISA from £20,000 to £12,000, except for over-65s;

And in a move that will prove particularly unpopular with savers, people paying into a pension under salary sacrifice schemes will face national insurance on contributions above £2,000.

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The tax rises – which were published by the Office for Budget Responsibility (OBR) ahead of time in an unprecedented blunder – are mostly needed to pay for increased welfare spending.

Ms Reeves announced the abolition of the two-child benefit cap, expected to lift 450,000 children out of poverty.

You should resign, says Badenoch

Tory leader Kemi Badenoch accused her of “hiking taxers on workers, pensioners, and savers to pay for handouts”, claiming the budget will increase benefits for 560,000 families by £5,000 on average.

Ms Reeves had sought to cut the welfare bill earlier this year, but the government was forced into a damaging retreat after backbench Labour MPs rebelled.

“What she could have chosen today is to bring down welfare spending and get more people into work,” Ms Badenoch told the Commons on Wednesday.

“Instead, she has chosen to put a tax up to tax after tax.”

She called on the chancellor to resign.

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Under fire from left and right

Labour MPs cheered raucously at the two-child benefit cap announcement, but one backbencher told Sky News: “We are effectively doing government by consent of the PLP, if not the cabinet – a bad place to be.

“The Tories did it for years, and it can only lead to the death of us at the general election.”

Liberal Democrat leader Sir Ed Davey, meanwhile, warned Ms Reeves cannot “tax her way to growth”, while Reform’s Nigel Farage described the budget as an “assault on ambition and saving”.

Greens leader Zack Polanski criticised the budget for not raising taxes on the “super wealthy”.

Read more: A town that feels betrayed

Sky’s Sophy Ridge and Wilfred Frost won’t be the only ones putting the chancellor under more scrutiny today – two influential economic think tanks will also give their full verdicts.

The Institute for Fiscal Studies (IFS) and the left-leaning Resolution Foundation have already been critical in their immediate verdicts, with the former describing the budget as “spend now, pay later”, with tax rises being increasingly relied upon over time.

It also accused Ms Reeves of breaching Labour’s manifesto commitments on tax.

The Resolution Foundation warned of a hit to living standards because of Ms Reeves’s measures, though she has said policies aimed at cutting household energy bills and freezing rail fares and prescription charges will help people.

She also claimed her decisions would help cut NHS waiting lists and the national debt.

Also facing more questions today is the head of the OBR, as he remains under pressure over how its forecast of the chancellor’s announcements were published ahead of time.

Follow live updates on the fallout from the budget in the Politics Hub and Money through the day.

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Will you be better or worse off than you were before Chancellor Rachel Reeves announced her tax and spending plans in her long-awaited budget?

From the minimum wage and scrapping of the two-child benefit cap to ISA caps and tax threshold freezes, Niall looks at how the budget will impact you with personal finance expert Iona Bain.

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Editor: Wendy Parker