A Budget of broken promises that taxed workers & spared the super-rich

The Chancellor’s 2025 Budget seems designed to secure the government’s survival, by offering piecemeal reforms to placate the markets, businesses and the public. But with no coherent vision, or large-scale structural changes, they won’t materially change most people’s lives or resolve the gross inequality destroying the country. 

With a lot of policy announcements, a lot of spin, and a lot of smoke and mirrors it can be hard to know what it all means. So here’s the 5 things you need to know:

1. Ordinary people will pay more tax

The government has continued the freeze on Income and NICs thresholds to 2030/31. Freezing income tax thresholds is a broken manifesto pledge in disguise and means millions of people will see their tax bills rise as their earnings increase. This means that people will pay a higher proportion of their income in tax and may even enter a new tax band (known as fiscal drag). 

Since 2008, working people have only seen their wages grow by £12 a week in real terms, whilst billionaires have seen their wealth grow by more than £370 billion (since 2010). So, it is shocking that the biggest revenue raiser, in a Budget that should have been about taxing the super-rich more, will instead target ordinary people. 

The Chancellor has risked locking in falling living standards for nurses, teachers and builders as measures to tackle the cost-of-living are minimised by higher tax bills. And whilst the government asks for more from the empty wallets of ordinary people, they’ve left the deep pockets of the super-rich largely untouched.

2. The Super-Rich have been given a free pass

The most obvious thing about this Budget is what’s not in it. If the news headlines are to be believed, in the months running up November the Government has responded to calls for, or been reported to be seriously considering, a huge range of taxes that would finally make the super-rich pay their fair share, including:

• A wealth tax
• A ‘settling up tax’ to recoup investment if someone with capital gains leaves
• Further reform of capital gains tax 
• Broadening national insurance to cover more types of income from assets
• A tax on the excessive profits of banks due to inflation.

But in the end, not one of these policies has made it into the final budget. So, what happened? After weeks of speculation, “leaks” and rumors, we finally know who the Chancellor listened to for her Budget tax changes. Unfortunately it’s not the public, their own MPs, trade unions, charities, or world-leading economists. 

It’s the powerful lobbying teams of the greedy, wealthy minority that have flooded the news and the halls of Westminster with scaremongering, misinformation and even fabricated evidence, whenever a progressive tax reform has been reported as under consideration by the Chancellor.

3. While the moderately rich will pay more

Thanks to our relentless campaigning, the government has been forced to look at wealth. But rather than focus on the extreme wealth of the billionaire class — the 0.1%, the government has opted to target the more moderately wealthy— the top 10%, and failed to raise enough funds by doing so to secure the sort of transformative investment the country needs.

Property taxes
The government is painting their new council tax surcharge on properties worth more than £2 million as a major tax on wealth. It will be introduced for properties valued over £2m, with four price bands charging between £2,500 and £7,500.

Properties in these bands will continue paying their existing Council Tax, plus the new surcharge, which will go to central government. This is a step in the right direction insofar as it is taxing wealth, but in reality it’s a sticking plaster on a broken leg.

Firstly, it is only expected to raise a measly £400-450 million. For scale, that’s about 48x less than the wealth tax we’re calling for would bring in. And rather than focusing on the wealthiest 0.04% of the country (just 20,000 people) like our preferred wealth tax, this will impact an estimated 165,000 households— not even guaranteed to be the wealthiest.

In fact the new tax protects the super-rich from paying their fair share by capping the maximum charge. So those with £500 million houses, will pay just £7,500, the same as those with with £5million houses.

The government often cites “asset rich, cash poor” households to argue against wealth taxes, but it’s their policy that risks falling foul of that problem. Uneven property price rises—especially in London and the South East—have turned some ordinary family homes bought decades ago into £1m+ properties.

Meanwhile the richest 1% hold only about 20% of their wealth in property. To tax the wealth of the super-rich effectively, we need to look at people’s assets in their entirety, through a modest 2% tax on wealth over £10 million.

Taxes on income from wealth

The Government will increase income tax rates on investment income –  dividends, savings and property – by 2% from April 2026 and April 2027 respectively. This is set to net the Treasury £2.1bn by 2029/30. While welcome, this is a half-measure that doesn’t target the extreme wealth of the super-rich. 

It still leaves those working to pay their rent or bills on higher effective tax rates than their landlords, or people who live off the income from their assets. That’s why the government should have gone further and announced a total equalisation of how income from wealth and work are taxed, by extending the scope of NICs to include investment and partnerships income, and equalising Capital Gains Tax rates with income tax and closing unfair loopholes. 

We have been campaigning for years to bring the taxes on income from wealth in line with the income from work. This would raise £15.5 billion—thats about 7.5x more than the government’s plans— and finally put an end to the two-tier tax system.

4. There are some important signs of hope, and evidence that our movement can win

Despite a generally disappointing budget, there were a few announcements to really shout about, including the scrapping of the 2-child limit, an increase in the minimum wage and the raising of taxes on online gambling.

Scrapping the two-child limit will be life changing for some 350,000 children who will be lifted out of poverty overnight (when the policy comes into effect in April 2026), according to the Child Poverty Action Group. It will also significantly reduce the level of poverty that a further 700,000 children live in. 

Like most progressive policy changes, this didn’t just happen. It has been achieved following years of tireless campaigning from movements and coalitions that have forced the issue onto the agenda. Even these small victories would not have happened were it not for the weight of our movement pushing for change.

The same is true of the new gambling tax announced today, which should bring in around £1.1 billion for our schools and hospitals, whilst curbing some of the most damaging forms of gambling. But even here it seems the Chancellor has at least partially caved to the loud demands of greedy vested interests— watering down the proposals from ex Prime Minister Gordon Brown, that would have raised closer to £3 billion. 

And we also found out that the Digital Services Tax will NOT be scrapped, as was feared. This is a direct result of public outcry, demanding they not cave to Trump’s pressure and give big tech companies a new £5 billion tax break.

5. We need real transformation, not tinkering

There were bucketloads of tiny tax changes in this year’s Budget, from new taxes on milkshakes, to fuel duties on electric cars. Most of these won’t make a huge difference to the lives of millions up and down the country.

They also won’t go far in providing the massive cash injection needed to invest in Britain’s future, or to make healthcare, housing and education world-class. Or address the rapidly-growing obscene gap between rich and poor that is threatening to consume our country, our democracy, and our planet.