In the first Labour budget in over 14 years, the Chancellor of the Exchequer announced several changes expected to directly impact the lives of young people in the capital.
Chancellor of the Exchequer, Rachel Reeves, holding the red box outside Downing Street, ahead of delivering the Autumn Budget.
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Chancellor of the Exchequer, Rachel Reeves, announced several changes in the budget expected to directly impact the lives of young people in the capital.
The Labour government announced the plans on the 30th of October, forming the biggest rise in tax since 1993.
We’ve broken down some of the key points expected to impact young Londoners.
London Living Wage
The London Living Wage is set to increase to £13.85 an hour for all living wage workers in the capital.
Reeves also confirmed that the National Minimum Wage will increase from £8.60 to £10 an hour for 18-to-20-year-olds – a rise of 16%. The change is the largest on record, and forms part of government efforts to introduce a single minimum rate for all adults in the future, according to the Treasury.
The National Living Wage will also rise for over-21s from £11.44 to £12.21 an hour, a rise of just under 7%. The changes announced on Wednesday are expected to come into effect in April 2025.
Alcohol
The government will be cutting the duty on draught beer by 1.7% from February next year.
The duty rates on non-draught products, such as spirits and wine, will increase in line with the Retail Price Index (RPI) in February 2025.
However, the increase in contributions paid by business owners will rise from 13.8% to 15% on a worker’s earning above £175. There are fears that prices will increase in the new year to accommodate for this, though the extension of the Employers Allowance (the amount employers can claim back from their National Insurance bill) from £5,000 to £15,000 may counter this.
Smoking and e-Cigarettes
From October 2026, a new tax will see a charge of £2.20 per 10ml of e-cigarette liquid introduced by the Labour government. The government says it hopes this will discourage young people and smokers from taking up vaping.
Similarly, the Chancellor has announced an above-inflation rise of 2% on tobacco prices, and a 10% increase on the price of hand-rolled tobacco.
Public Transport
The Chancellor has also made increases to the national bus fare cap – although this will not affect London buses.
London buses fares continue to be capped at £1.75. However, outside the capital this cap will increase from £2 to £3 per journey.
Stamp Duty and Property Ownership
There are fears it will be harder for Londoners to get onto the property ladder following Labour’s announcement that the Stamp Duty threshold is dropping to £300,000.
The previous Stamp Duty threshold sat at £425,000.
Lifetime ISA (LISA)
A Lifetime ISA (LISA) can be opened by anyone aged between the ages of 18 and 39. They can be used to save up to £4,000 a year, towards a first home.
The price of that first home, for which a LISA could be used, was previously capped at £450,000.
There was no update on LISAs used for young people saving towards getting on the property ladder.
The £450,000 cap remains unchanged, and was not again increased in line with inflation. This means a real term decrease.
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StandfirstIn the first Labour budget in over 14 years, the Chancellor of the Exchequer announced several changes expected to directly impact the lives of young people in the capital.
Chancellor of the Exchequer, Rachel Reeves, announced several changes in the budget expected to directly impact the lives of young people in the capital.
The Labour government announced the plans on the 30th of October, forming the biggest rise in tax since 1993.
We’ve broken down some of the key points expected to impact young Londoners.
London Living Wage
The London Living Wage is set to increase to £13.85 an hour for all living wage workers in the capital.
Reeves also confirmed that the National Minimum Wage will increase from £8.60 to £10 an hour for 18-to-20-year-olds – a rise of 16%. The change is the largest on record, and forms part of government efforts to introduce a single minimum rate for all adults in the future, according to the Treasury.
The National Living Wage will also rise for over-21s from £11.44 to £12.21 an hour, a rise of just under 7%. The changes announced on Wednesday are expected to come into effect in April 2025.
Alcohol
The government will be cutting the duty on draught beer by 1.7% from February next year.
The duty rates on non-draught products, such as spirits and wine, will increase in line with the Retail Price Index (RPI) in February 2025.
However, the increase in contributions paid by business owners will rise from 13.8% to 15% on a worker’s earning above £175. There are fears that prices will increase in the new year to accommodate for this, though the extension of the Employers Allowance (the amount employers can claim back from their National Insurance bill) from £5,000 to £15,000 may counter this.
Smoking and e-Cigarettes
From October 2026, a new tax will see a charge of £2.20 per 10ml of e-cigarette liquid introduced by the Labour government. The government says it hopes this will discourage young people and smokers from taking up vaping.
Similarly, the Chancellor has announced an above-inflation rise of 2% on tobacco prices, and a 10% increase on the price of hand-rolled tobacco.
Public Transport
The Chancellor has also made increases to the national bus fare cap – although this will not affect London buses.
London buses fares continue to be capped at £1.75. However, outside the capital this cap will increase from £2 to £3 per journey.
Stamp Duty and Property Ownership
There are fears it will be harder for Londoners to get onto the property ladder following Labour’s announcement that the Stamp Duty threshold is dropping to £300,000.
The previous Stamp Duty threshold sat at £425,000.
Lifetime ISA (LISA)
A Lifetime ISA (LISA) can be opened by anyone aged between the ages of 18 and 39. They can be used to save up to £4,000 a year, towards a first home.
The price of that first home, for which a LISA could be used, was previously capped at £450,000.
There was no update on LISAs used for young people saving towards getting on the property ladder.
The £450,000 cap remains unchanged, and was not again increased in line with inflation. This means a real term decrease.
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