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The chancellor is vowing to “take the fair and necessary choices” in today’s budget, as she seeks to grow the economy while keeping the public finances under control.

Rachel Reeves said she will not take Britain “back to austerity” – and promised to “take action to help families with the cost of living”.

She said she will “push ahead with the biggest drive for growth in a generation”, promising investment in infrastructure, housing, security, defence, education and skills.

But following a downgrade in the productivity growth forecast – combined with the U-turns on the winter fuel allowance and benefits cuts as well as “heightened global uncertainty” – the chancellor is expected to announce a series of tax rises as she tries to plug an estimated £30bn black hole in the public finances.

Conservative shadow chancellor Sir Mel Stride has said Ms Reeves is “trying to pull the wool over your eyes”, having promised last year she would not need to raise taxes again. Liberal Democrat deputy leader Daisy Cooper has accused her and the prime minister of “yet more betrayals”.

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10 times the government promised not to increase taxes

‘Smorgasbord’ of tax rises

A headline tax-raising measure tomorrow is expected to be an extension of the freeze on income tax thresholds for another two years beyond 2028, which should raise about £8bn.

This move will be seized upon by opposition parties, given that the chancellor said at last year’s budget that extending the freeze, first brought in by the Tories in April 2021 to raise revenue amid vast spending during the pandemic, “would hurt working people” and “take more money out of their payslips”.

Watch our special programme for Budget 2025 live on Sky News from 11am.
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Watch our special programme for Budget 2025 live on Sky News from 11am.

What is being described as a “smorgasbord” of tax rises is also expected to be announced, having backed away from a manifesto-breaching income tax rise.

Some of the measures already confirmed by the government include:

• Allowing local authorities to impose a levy on tourists staying in their areas

• Expanding the sugar tax levy to packaged milkshakes and lattes

• Imposing extra taxes on higher-value properties

It is being reported that the chancellor will also put a cap on the tax-free allowance for salary sacrifice schemes, raise taxes on gambling firms, and bring in a pay-per-mile scheme for electric vehicles.

What are the key timings for the budget?

11am – Sky News special programme starts.

Around 11.15am – Chancellor Rachel Reeves leaves Downing Street and holds up her red box.

12pm – Sir Keir Starmer faces PMQs.

12.30pm – The chancellor delivers the budget.

Around 1.30pm – Leader of the Opposition Kemi Badenoch delivers the budget response.

2.30pm – The independent Office for Budget Responsibility (OBR) holds a news conference on the UK economy.

4.30pm – Sky News holds a Q&A on what the budget means for you.

7pm – The Politics Hub special programme on the budget.

What could her key spending announcements be?

As well as filling the black hole in the public finances, these measures could allow the chancellor to spend money on a key demand of Labour MPs – partially or fully lifting the two-child benefits cap, which they say will have an immediate impact on reducing child poverty.

Benefits more broadly will be uprated in line with inflation, at a cost of £6bn, The Times reports.

In an attempt to help households with the cost of the living, the paper also reports that the chancellor will seek to cut energy bills by removing some green levies, which could see funding for some energy efficiency measures reduced.

Other measures The Times says she will announce include retaining the 5p cut in fuel duty, and extending the Electric Car Grant by an extra year, which gives consumers a £3,750 discount at purchase.

The government has already confirmed a number of key announcements, including:

• An above-inflation £550 a year increase in the state pension for 13 million eligible pensioners

• A freeze in prescription prices and rail fares

• £5m to refresh libraries in secondary schools

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What the budget will mean for you

Extra funding for the NHS will also be announced in a bid to slash waiting lists, including the expansion of the “Neighbourhood Health Service” across the country to bring together GP, nursing, dentistry and pharmacy services – as well as £300m of investment into upgrading technology in the health service.

And although the cost of this is borne by businesses, the chancellor will confirm a 4.1% rise to the national living wage – taking it to £12.71 an hour for eligible workers aged 21 and over.

For a full-time worker over the age of 21, that means a pay increase of £900 a year.

Read more from Sky News:
Reeves issues ‘pick ‘n’ mix’ warning ahead of budget
Are we set for another astoundingly complex budget?

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Sky News goes inside the room where the budget happens

Britons facing ‘cost of living permacrisis’

However, the Tories have hit out at the chancellor for the impending tax rises, with shadow chancellor Sir Mel Stride saying in a statement: “Having already raised taxes by £40bn, Reeves said she had wiped the slate clean, she wouldn’t be coming back for more and it was now on her. A year later and she is set to break that promise.”

He described her choices as “political weakness” = choosing “higher welfare and higher taxes”, and “hardworking families are being handed the bill”.

The Liberal Democrat deputy leader Daisy Cooper is also not impressed, and warned last night: “The economy is at a standstill. Despite years of promises from the Conservatives and now Labour to kickstart growth and clamp down on crushing household bills, the British people are facing a cost-of-living permacrisis and yet more betrayals from those in charge.”

She called on the government to negotiate a new customs union with the EU, which she argues would “grow our economy and bring in tens of billions for the Exchequer”.

Green Party leader Zack Polanski has demanded “bold policies and bold choices that make a real difference to ordinary people”.

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Tourist tax to be introduced across England

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Tourist tax to be introduced across England

Mayors will be able to introduce tourist taxes across England, the government has announced.

A day before the budget, communities secretary Steve Reed said mayors will be given the power to impose a “modest” charge on visitors staying overnight in hotels, bed and breakfasts, guest houses and holiday lets.

Politics latest: Milkshakes and lattes to be taxed in the budget

The money raised is intended to be invested in local transport, infrastructure and the visitor economy to potentially attract more tourists.

Regional Labour leaders such as London Mayor Sir Sadiq Khan and Greater Manchester’s Andy Burnham have been calling for the measure.

However, the hospitality industry condemned the move as “damaging”.

The visitor levy will bring England in line with Scotland and Wales, which are already introducing tourist taxes.

More on Budget 2025

Officials said it would bring English cities into line with other tourist destinations around the world, including New York, Paris and Milan, which already charge a tourist tax.

They said research showed “reasonable” fees had a “minimal” impact on visitor numbers.

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The budget vs your wallet: How the chancellor could raise billions

Sir Sadiq said it is “great news for London” and said the tax will “directly support London’s economy and help cement our reputation as a global tourism and business destination”.

The Greater London Authority previously estimated a £1 a day levy could raise £91m, and a 5% levy could raise £240m.

Mr Burnham said the tax will allow Greater Manchester to “invest in the infrastructure these visitors need, like keeping our streets clean and enhancing our public transport system through later running buses and trams, making sure every experience is a positive and memorable one”.

Read more:
What tax rises could Rachel Reeves announce?

Reeves issues ‘pick ‘n’ mix’ warning ahead of looming budget

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Sky News goes inside the room where the budget happens

However, Lord Houchen, the Conservative Tees Valley mayor, said he will not introduce a tourist tax, adding: “Thanks, but no thanks.”

Conservative shadow local government secretary Sir James Cleverly branded it “yet another Labour tax on British holidays, pushing up costs for hard-pressed families, and yet another kick to British hospitality”.

Kate Nicholls, chair of UKHospitality, warned the “damaging holiday tax” could cost the public up to £518 million, adding: “Make no mistake – this cost will be passed directly on to consumers, drive inflation and undermine the government’s aim to reduce the cost of living.”

The plans will be subject to a consultation running until 18 February, which will include considering whether there should be a cap on the amount.

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Man arrested in connection with massive illegal waste dump in Kidlington, Oxfordshire

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Man arrested in connection with massive illegal waste dump in Kidlington, Oxfordshire

A man has been arrested in connection with the large-scale illegal tipping of waste in Oxfordshire, police have said.

The 39-year-old, from the Guildford area, was arrested on Tuesday following co-operation between the Environment Agency (EA) and the South East Regional Organised Crime Unit.

Last week, the EA declared the 40ft-high mountain of waste near Kidlington a “critical incident”.

The illegal site is on the edge of Kidlington in Oxfordshire
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The illegal site is on the edge of Kidlington in Oxfordshire

Anna Burns, the Environment Agency’s area director for the Thames, said that the “appalling illegal waste dump… has rightly provoked outrage over the potential consequences for the community and environment”.

“We have been working round the clock with the South East Regional Organised Crime Unit to bring the perpetrators to justice and make them pay for this offence,” she added.

“Our investigative efforts have secured an arrest today, which will be the first step in delivering justice for residents and punishing those responsible.”

Pic: PA
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Pic: PA

Phil Davies, head of the Joint Unit for Waste Crime, added that the EA “is working closely with other law enforcement partners to identify and hold those responsible for the horrendous illegal dumping of waste”.

More on Environment

He then said: “A number of active lines of investigation are being pursued by specialist officers.”

Sky News drone footage captured the sheer scale of the rubbish pile, which is thought to weigh hundreds of tonnes and comprise multiple lorry loads of waste.

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‘Milkshake tax’ to be introduced in budget

The EA said that officers attended the site on 2 July after the first report of waste tipping, and that a cease-and-desist letter was issued to prevent illegal activity.

After continued activity, the agency added that a court order was granted on 23 October. No further tipping has taken place at the site since.

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Graham Linehan cleared of harassment but guilty of criminal damage to trans activist’s phone

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Graham Linehan cleared of harassment but guilty of criminal damage to trans activist's phone

Father Ted creator Graham Linehan has been cleared of harassment against a trans activist but guilty of criminal damage to their phone.

The 57-year-old comedy writer, who had faced trial at Westminster Magistrates’ Court, denied both charges linked to posts made on social media and a confrontation at a conference in London in October 2024.

Summarising her judgment, District Judge Briony Clarke started by saying it was not for the court to pick sides in the debate about sex and gender identity.

She said she found Linehan was a “generally credible witness” and appeared to be “genuinely frank and honest”, and that she was not satisfied his conduct amounted to the criminal standard of harassment.

Pic: Ben Whitley/ PA
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Pic: Ben Whitley/ PA

The judge said she accepted some of complainant Sophia Brooks’s evidence, but found they were not “entirely truthful” and not “as alarmed or distressed” as they had portrayed themself to be following tweets posted by the comedy writer.

While Linehan’s comments were “deeply unpleasant, insulting and even unnecessary”, they were not “oppressive or unacceptable beyond merely unattractive, annoying or irritating”, the judge said, and did not “cross the boundary from the regrettable to the unacceptable”.

However, she did find him guilty of criminal damage, for throwing Brooks’s phone. Having seen footage of the incident, the judge said she found he took the phone because he was “angry and fed up”, and that she was “satisfied he was not using reasonable force”.

The judge said she was “not sure to the criminal standard” that Linehan had demonstrated hostility based on the complainant being transgender, and therefore this did not aggravate his offence.

He was ordered to pay a fine of £500, court costs of £650 and a statutory surcharge of £200. The prosecution had asked the judge to consider a restraining order, but she said she did not feel this was necessary.

What happened during the trial?

The writer, known for shows including Father Ted, The IT Crowd and Black Books, had flown to the UK from Arizona, where he now lives, to appear in court in person.

He denied harassing Brooks on social media between 11 and 27 October last year, as well as a charge of criminal damage of their mobile phone on 19 October outside the Battle of Ideas conference in Westminster.

The trial heard Brooks, who was 17 at the time, had begun taking photographs of delegates at the event during a speech by Fiona McAnena, director of campaigns at Sex Matters.

Giving evidence during the case, Linehan claimed his “life was made hell” by trans activists and accused Brooks, a trans woman, of being a “young soldier in the trans activist army”.

He told the court he was “angry” and “threw the phone” after being filmed outside the venue by the complainant, who had asked: “Why do you think it is acceptable to call teenagers domestic terrorists?”

Brooks told the court Linehan had called them a “sissy porn-watching scumbag”, a “groomer” and a “disgusting incel”, to which the complainant had responded: “You’re the incel, you’re divorced.”

The prosecution claimed Linehan’s social media posts were “repeated, abusive, unreasonable” while his lawyer accused the complainant of following “a course of conduct designed both to provoke and to harass Mr Linehan”.

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Following the judgment but ahead of sentencing, Linehan’s lawyer Sarah Vine KC said the court “would do well to take a conservative approach towards the reading of hostility towards the victim”.

She said the offence of criminal damage involved a “momentary lapse of control”, and was part of the “debate about gender identity, what it means”.

Vine said it was important “that those who are involved in the debate are allowed to use language that properly expresses their views without fear of excessive state interference for the expression of those views”.

She also said the cost of the case to Linehan had been “enormous”, telling the court: “The damage was minor; the process itself has been highly impactful on Mr Linehan.”

She requested he be given 28 days to pay the full amount.

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