Announcement over 55p rule 'for motorists under 10k miles'

Announcement over 55p rule 'for motorists under 10k miles' Officials believe an overall package will benefit approximately three million employees and self-employed workers The Government has announced five "everyday fixes" ahead of Wednesday's Budget to ease the cost-of-living burden on households, including permanently fixing the 55p per mile work rate – subject to a 10,000-mile limit. The Chancellor and Prime Minister have revealed that a higher tax-free mileage allowance will be made permanent, while tariffs on a range of food products will be reduced to lower prices for consumers, as part of a wider package of measures aimed at alleviating the ongoing financial pressures facing the public. Andy Burnham also signalled that Wednesday's fiscal event would go further to offer both individuals and businesses "breathing space", beyond the steps already announced by himself and John Healey. Among the measures revealed on Tuesday, and expected to feature in Wednesday's Budget, the Chancellor will permanently set the 55p mileage rate for work-related driving for the first 10,000 miles. For distances beyond that threshold, the rate will increase from 25p to 35p. The Government anticipates the overall package will benefit approximately three million employees and self-employed workers. The Treasury estimates the combined measures are worth £120 a year in "additional tax savings" for a worker covering 6,000 business miles, rising to £300 for those driving 15,000 business miles, compared to rates prior to April 2026. Mileage rates Cars and vans First 10,000 miles // Above 10,000 miles2 5p per mile – rate being made “permanent” (25p per mile – rising to 35p per mile from 6 April 2027 // 25p per mile – rising to 35p per mile from 6 April 2027 Motorcycles 24p per mile – not changing // 24p per mile – not changing Bikes 20p per mile – not changing // 20p per mile – not changing Back in May 2026, when the previous mileage rate increase was unveiled, financial expert Martin Lewis described it as a "really important" change that would be "really quite useful for people". The Government is also scrapping tariffs on over 100 products, including popular foods such as baked beans, chocolate and gherkins. According to the Treasury, this will save households approximately £21 on their annual food shopping bill. Meanwhile, tariff reductions on fertilisers are designed to benefit farmers, while a tariff cut on kerosene will assist households that rely on the fuel for heating. Ministers also intend to extend parental pay to more than 150,000 parents annually, including self-employed fathers who were previously excluded. Ensure our latest home economics headlines always appear at the top of your Google Search by making us a Preferred Source. Click here to activate or add us as Preferred Source in your Google search settings A cliff edge on carer's allowance will be ended, with the Government instead tapering away £1 of the benefit for every £1 earned above the weekly limit. Additionally, the Government is introducing hundreds of extra Post Office drop boxes, aiming to reduce queuing times at counters for sending and returning parcels, particularly during the busy Christmas period. Prime Minister Mr Burnham stated: "We are taking on the big challenges facing the country. But that doesn't mean losing sight of the everyday problems that cost people money or simply aren't fair. "If you're a nurse driving for work, a parent spending those precious first weeks with your new baby, or an unpaid carer picking up an extra shift, these changes will make life a little easier and put more money back in your pocket. "And at Wednesday's Budget, we'll go further to give families and businesses the breathing space they need today, while we build a stronger economy, transform our country and bring down cost for people long-term." The Chancellor, Mr Healey, commented: "Today's everyday fixes are just a small part of what we are doing to give families a bit of breathing space. "Conflict in the Middle East and Europe is hitting families here at home through higher everyday costs. "We can't control global events, but we can act where we can make a difference." It emerged on Monday that the Budget is expected to provide a £432 million boost to help ensure homeless people are off the streets by Christmas. Mr Burnham expressed his desire to give "every single person" sleeping on the streets an offer of help by the end of this year.