(MENAFN) The UK administration has revealed £26 billion ($34.4 billion) in tax hikes, which will push taxation to unprecedented levels for much of the population, while reiterating its aim to expand military expenditure.

Chancellor Rachel Reeves presented a fresh budget on Wednesday that freezes income tax and National Insurance thresholds until 2031.

This means that salary increases will result in roughly 1.7 million individuals being moved into higher tax brackets.

The budget also reduces tax reliefs and savings incentives, while increasing taxes on investments and introducing new charges.

These include an annual levy on properties valued over £2 million ($2.6 million), elevated online gambling duties, and mileage-based fees for electric and hybrid vehicles.

Collectively, these measures represent £26 billion in tax increases for 2029-30, pushing the UK’s total tax revenue to a record 38% of national income by 2030-31, according to the Office for Budget Responsibility.

Economic experts caution that the new regulations will drive up living expenses for many households and have criticized Reeves for adjustments that contradict her prior promise not to raise taxes on working citizens.

Reeves acknowledged that “ordinary people” will have “to pay a little bit more,” but maintained that the reforms are “fair and necessary.”

Despite public dissatisfaction, Reeves confirmed plans to elevate the UK’s military spending to 2.6% of GDP during her budget announcement.

She emphasized, “In our age of insecurity Britain will continue to stand with our allies… maintaining our commitment to NATO with the UK set to spend 2.6% of GDP on defense by April 2027.”

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