London, 1 March: Chancellor Rachel Reeves and the Labour Party had promised not to raise taxes on working people. However, the new budget shows that this promise has been broken, placing a heavier tax burden on workers.

According to the latest budget, the tax-free Personal Allowance has been frozen at £12,570 until 2031. In 2019, it was £12,500, which, if adjusted for inflation, should have been around £16,215. At the same time, the higher-rate tax threshold of £50,270 has also been frozen until 2031.

As a result, even as wages rise, workers will end up paying more tax. Those crossing the higher-rate threshold for the first time, and others pushed into the 40% tax bracket due to inflation, will see their tax bills increase significantly.

State pensioners have been granted a special exemption. From 2027, pensioners whose income exceeds the Personal Allowance will not have to pay tax. Meanwhile, ordinary working people continue to carry the full burden.

Analysts say this budget directly undermines Labour’s earlier promise and effectively takes more money out of the pockets of already stretched workers.