Pints, planes and pay: What’s changing after Reeves’ Budget?

By ITV Producer Connor Parker
Labour’s first Budget in almost 15 years was giant in scope, but amid the promises of investing in the country were numerous tax hikes that will see the price of many things go up – and a few things go down.
Rachel Reeves’s first Budget saw her announce £40bn in tax rises billed as being necessary to “rebuild Britain” and a sweep of new spending on schools, the NHS and capital investment.
The largest tax hike came in the form of a 1.2% increase in employer contributions to national insurance, as well as lowering the threshold at which it is paid from £9,100 to £5,000.
Reeves said this would raise around £25bn a year.
But beyond the headline figures, she announced numerous other changes that will see price changes, so here’s everything that will go up (and down) as a result of the Budget.
Minimum wage
The minimum wage will rise to £12.21 an hour next year after a 6.7% rise was confirmed in the Budget.
The increase will mean an extra £1,400 a year for a full-time worker earning the main minimum wage rate, known as the national living wage, from April 2025.
The Chancellor also announced that the minimum wage for people aged 18-20 would rise to £10 an hour, an increase of £1.40.
The minimum wage for apprentices and those aged 16-17 will also increase by 18%, reaching £7.55 an hour, meaning a total of 3.5 million workers are expected to receive pay rises in April as a result.
Reeves described the move as a “significant step” towards delivering on Labour’s manifesto promise to introduce a “genuine living wage for working people”.
Bus fares
The bus fare cap in England is being increased from £2 to £3 for most of the country and it will last until 2025.
Speaking before the Budget the prime minister justified the change saying the Tories had only budgeted for the cap to last until 2024, and keeping it in place at £3 would help rural communities.
The cap does not apply in London and Manchester where the buses are publicly run.
Flights
Reeves said the air passenger duty (APD) will rise, adding up to £2 to the cost of an economy ticket for a short-haul flight.
APD rates are based on the length of the flight and the class of cabin.
For passengers travelling in economy, they are £7 for a domestic flight, £13 for a short-haul flight, and £88-£92 for a long-haul flight.
The increases from 2026/27 will add £1 to domestic flights, £2 to short-haul flights and £12 to long-haul flights.
Those in premium cabins are charged £14 for a domestic flight, £26 for a short-haul flight, and £194-£202 for a long-haul flight.
The chancellor also announced a 50% hike in the APD private flights pay.
Private jet passengers currently face an APD rate of £78 for domestic or short-haul flights, and £581-£607 for long-haul flights.
Tobacco
The chancellor announced that the tax on tobacco would increase with RPI plus 2% for the rest of Parliament. She also increased the duty by a further 10% on hand-rolling tobacco.
The government said the one-off hike was there to incentivise people to choose refillable vaping over smoking, but it’s not all good news for vapers.
Vapes
Vapes are also being taxed with a new duty on vapes being introduced from October 1 2026. It will be charged at £2.20 per 10ml.
The announcement comes after laws were announced to ban disposable vapes in the UK from June next year, aimed at putting young people off trying them and reducing waste.
Pints
If you’ve read ‘pints’ on this list and think the price of a drink at a local pub couldn’t possibly be going up more then you’ll be pleased to know the chancellor cut the price on draught beer duty on Wednesday by a whole penny.
The 1p cut only applies to draught beer (the most popular purchase in Britain’s pubs) meaning wine, spirits and bottled beer will not benefit.
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The price of alcohol in shops will not change either.
Fizzy drinks
Reeves also announced the soft drinks levy (also known as the sugar tax) would be increased to account for inflation since it was introduced in 2018.
She said this would raise around £1bn over the course of the Parliament.
What’s staying the same?
Although most purchases will not be affected by the Budget it is worth mentioning one unexpected outcome of today’s announcement – there will be no change in fuel duty.
It was widely rumoured Reeves would be ending the more than a decade-long freeze on fuel duty, or reversing the 2022 5p cut in the rate.
Instead, she said she would keep the rates the same at the cost of £3bn to the treasury, in a small win for drivers.
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