Chancellor John Healey extended the electricity VAT cut and the 5p fuel duty cut in the Budget on Wednesday, funding energy support by doubling the bank surcharge from 3% to 6%.
The Treasury said the Bank Corporation Tax Surcharge will stay at 6% for 15 months and end on 31 March 2028. The extra revenue pays for the energy measures.
Those measures include a £100 Household Energy Payment in 2027 for up to 20 million households in council tax bands A to D in England.
The VAT cut on electricity is extended until 1 July 2027 and takes around £50 off the Ofgem annual price cap in April 2027.
Drivers keep the 5p fuel duty cut for a further six months. The planned Retail Prices Index increase is deferred to 1 July 2027.
Stephen Kinnock, Secretary of State for Wales, said the package was giving households "much needed breathing space" through lower food and energy costs and more money for lower income pensioners and workers.
In Wales, the 4% tariff on kerosene is removed, which the government said will support 105,000 households that rely on heating oil. The Welsh Government gets an extra £450 million for public services, on top of £1 billion from Budget 2025 and Spring Forecast 2026.
The Welsh package also lifts the National Living Wage by 3.9% to £13.21 an hour.
The government said it will fully fund the £15bn Defence Investment Plan, including £4.7bn that was previously unfunded.
Around 70,000 more retail, hospitality and leisure businesses will be taken out of business rates through a higher Small Business Rates Relief threshold. As a result, half of all such properties in England will pay no business rates.
All retail, hospitality and leisure properties also get a two-year real-terms freeze in rates bills. That comes on top of a 20% cut for pubs and most live music venues announced in July.
From April 2027 the British Industrial Competitiveness Scheme will support over 10,000 eligible businesses in electricity-intensive sectors. It cuts their electricity bills by up to 25%.
Eligible founders of high-growth companies will pay a reduced 10% rate of Capital Gains Tax on up to £10m of lifetime gains. The trading allowance triples from £1,000 to £3,000.
The National Wealth Fund and British Business Bank will receive an additional £20.4bn. Of that, the National Wealth Fund gets £15.4bn, including £2bn for a new Energy Wealth Fund.
Social and affordable housing gets a further £1.5bn, taking capital investment over 10 years above £40bn.
The Lifetime ISA withdrawal charge falls to 20% from the day of the Budget. The Treasury said first-time buyers buying above the existing £450,000 price cap will no longer be penalised.
A new First Time Buyer ISA is also planned.
The Treasury said the Budget rejects broad-based tax rises. It said the investment rule is met with headroom of £24bn in 2029-30 and that debt is lower at the end of the forecast than it is now.
Borrowing, which fell last year, continues to fall over the forecast period, it said.
Rachel Skinner CBE will chair a review of rail infrastructure costs that is due to report in six months.
