Key takeaways
On Wednesday 30 October, the Chancellor Rachel Reeves delivered her first Budget, and Labour’s first in 14 years.
She focused on the importance of “restoring economic stability” and ”rebuilding Britain”. We have compiled an overview of the key takeaways and announcements which may impact you and your fleet.
Register now
Join Zenith's hour-long webinar on 6 November, where our consultancy team will be joined by Zohra Chagani, Senior Policy Advisor at the BVRLA, to deliver a detailed analysis of Labour's first budget.
Vehicle tax
- Company Car Tax Rates provided up to 2029/2030 – EVs will increase by 2% points per year in 2028-29 and 2029-30. The rates for PHEVs will no longer be based on the electric range from 2028, and the rates for all other cars increase by 1% year on year.
- Government announced they will consider raising the threshold for the Expensive Car Supplement for zero emitting cars at a future fiscal event.
- £120m investment to continue the electric van grant into 2025-2026 and to support the manufacture of wheelchair accessible EVs.
- Double Cab Pick Ups will be treated as cars for taxation purposes from April 2025. If obtained prior to this date, drivers will be able to use the previous treatment until either lease expiry or 5 April 2029.
- Van Benefit Charge and the Car & Van Fuel Benefit Charges will increase in line with CPI from 6 April 2025.
- The temporary 5p cut in fuel duty rates will be extended, and current rate will be frozen for 2025-26.
- VED rates and HGV levy increased in line with RPI from 1 April 2025.
VED rates
- Standard VED rates for cars, vans and motorcycles, will increase in line with the RPI from 1 April 2025.
- The government will change the VED First Year Rates for new cars registered on or after 1 April 2025, to strengthen incentives to purchase zero emission and electric cars.
As previously announced, from April 2025, EVs registered after 1 April 2017 will attract the standard rate of VED as opposed to the current zero rate and EVs registered from April 2025 will be subject to the expensive car supplement. Zenith will be in contact with customers to update on how we’re implementing these changes.
Taxation and pension
- From 6 April 2025, Employer’s National Insurance (NI) will increase by 1.2% to 15%.
- The per employee threshold at which employers begin to pay NI will be reduced from £9,100 to £5,000 per year from April 2025.
- Current income tax and NI thresholds will remain until 2028/29 and will then be updated in line with inflation.
- Stamp duty on second homes will increase by 2% to 5% from 31 October 2024.
- The government will extend a freeze on the threshold for inheritance tax.
- From today, the lower rate of capital gains tax increased from 10% to 18% (20% to 24% higher rate).
Support to work
- National Living Wage to increase by 6.7% to £12.21 per hour from April 2025.
- The hourly pay for apprentices will increase from £6.40 to £7.55 per hour from April 2025.
- The National Minimum Wage will increase for 18–20-year-olds, from £8.60 to £10 per hour from April 2025.
- Eligibility widened for the allowance paid to full-time carers, by increasing the maximum earnings threshold from £151 to £195 per week.
Infrastructure
- Investment of over £200m in 2025-26 to accelerate EV chargepoint rollout.
- An extra £500m investment to fix potholes across the UK over the next year.
- £650m investment to improve the local rail transport network, including West Yorkshire Mass Transit including Bradford and Leeds.
- Cap on single bus fares in England to rise to £3 from January.
- Investment to get Britain moving, which will spur regional growth. This includes the rail TransPennine Route upgrade, between York and Manchester, via Leeds and Huddersfield.
