Incomes, savings and milkshakes, what is the government not taxing? – London Business News | London Wallet

The government’s Budget, presented today (eventually after the OBR leak), introduces a suite of tax and regulatory changes that will increase the financial pressure on households while offering little to support economic growth or consumer freedom.

The combination of frozen income-tax thresholds, reduced savings allowances, and limits on flexible pension arrangements amounts to a substantial, stealthy tax rise on ordinary earners. These measures shift more income, savings, and investment into the tax net without transparent debate.

“Consumers are being asked to shoulder higher taxes while receiving almost nothing in return,” said Mike Salem, UK Country Associate at the Consumer Choice Center.

Freezing thresholds and cutting savings freedoms punishes responsible financial behaviour and leaves families with less flexibility at a time when they need it most.”

The Chancellor’s decision to place restrictions on salary-sacrifice pension contributions make it harder for households to plan for long-term retirement security.

Lifestyle taxes: A backdoor expansion of the nanny state

The Budget also signals a renewed push for lifestyle taxes, including levies on milkshakes, other milk based sugary drinks, and gambling products. Although framed as public-health measures, these taxes disproportionately hit lower-income consumers and erode personal choice.

“Lifestyle taxes are an ineffective, regressive way to shape behaviour,” added Salem.

“Whether it’s milkshakes, betting products, or other ‘sin’ categories, these taxes restrict consumer autonomy and make everyday activities more expensive without meaningfully improving health outcomes, and further contribute to inequality as it hits the poorer disproportionately more.”

Such measures risk expanding the role of the state into individuals’ personal decisions while creating volatile, unreliable revenue streams that cannot sustainably fund public services.

A Budget that taxes more and delivers less

Taken together, today’s announcements represent a strategy focused on raising revenue through incremental tax grabs rather than delivering structural reform or reducing government inefficiency.

“Genuine fiscal responsibility comes from cutting waste and enabling economic growth, not from drip-feeding new levies on work, saving, and everyday choices,” said Salem.

The CCC urges the government to rethink these proposals and prioritise a pro-consumer, pro-growth agenda that empowers households rather than burdening them.

In his concluding remarks, Salem stated:

“This budget unfairly penalises young professionals. Reeves’ preference for over‑65s on ISAs, combined with limits on pension salary‑sacrifice contributions, hits those who are earning, saving, and spending. These measures risk leaving young workers worse off and could encourage talent to leave the country, which is a concerning outlook for the nation’s future.