Minimum Wage Raised to £12.21

The Chancellor confirmed that the minimum wage for those aged 21 and above will increase by 6.7% starting in April 2025.

Rising from £11.44 to £12.21, this equates to an annual salary of £22,222 for an employee working 35 hours per week.

The Treasury stated that the minimum wage increase for those under 21 is the largest on record. This also marks the first step towards establishing a unified minimum wage standard for all adults.

Employer National Insurance Contribution to Rise by 1.2%

The Chancellor announced an increase in the amount of National Insurance Contributions paid by employers.

From April 2025, this rate will rise to 15%.

Additionally, the threshold for employer contributions will lower from £9,100 per year to £5,000.

This measure is projected to generate £25 billion annually for the government.

Increase in Capital Gains Tax

The Treasury announced that both the lower and higher rates of Capital Gains Tax will be increased.

The lower rate will go from 10% to 18%, and the higher rate will increase from 20% to 24%.

The current rates will remain until April 2025.

This is expected to raise £2.5 billion for the Labour government.

Personal Income Tax Threshold Freeze to End

Since 2022, the personal income tax threshold has been frozen at £12,570.

This means that income over this threshold is subject to various levels of income tax.

The freeze on the income tax threshold implies that, as wages rise, individuals will end up paying more income tax.

To address this, the Treasury plans to adjust the personal income tax threshold in line with inflation starting from the 2028–2029 tax year.

Bus Fares to Rise in Multiple Regions

The Chancellor confirmed that single bus fares across multiple regions will increase from December 2025.

Currently capped at £2 per journey, the price will rise to £3.

It is reported that the fare increase will generate £650 million for transport departments across the country to improve connectivity in urban areas.