Rachel Reeves has unveiled her second Budget — introducing a £26 billion package of tax increases aimed at raising state revenue, while simultaneously scrapping the controversial two-child benefit cap. 

Among the key changes:

The freeze on income-tax thresholds has been extended, pushing hundreds of thousands more workers into higher tax bands. 

A new surcharge on high-value homes (a “mansion tax”) will target the wealthiest households. 

Taxes on savings interest, rental income and dividends are rising — and perks like the tax-free ISA allowance have been reduced. 

As part of a public-spending shake-up, the independent Office for Value for Money (OVfM) is being closed down — the government says its reforms have been absorbed into regular Treasury oversight. 

On the social side, the move to scrap the two-child cap on benefits has drawn praise from anti-poverty campaigners and charities, who say it will help families under pressure. 

Unsurprisingly, reactions have been starkly divided. Kemi Badenoch called the Budget a “total humiliation,” accusing Reeves of betraying voters by raising taxes on working people.  Meanwhile, many on the left of Labour Party argue it marks a bold step toward tackling inequality — while critics warn that the squeeze on incomes could hit the “squeezed middle” hard. 

https://news.sky.com/story/politics-latest-budget-taxes-reeves-starmer-labour-badenoch-farage-12593360