Chancellor Rachel Reeves has introduced a notable change in tax-free mileage rates, increasing the allowance from 45p to 55p per mile for employees driving less than 10,000 miles annually for work. This adjustment, which is effective retroactively from April 2026, aims to alleviate financial burdens on workers, especially care workers who frequently travel between clients. Martin Lewis, a prominent financial expert, emphasized the importance of this change, noting that it allows employees to reclaim taxes on any shortfall if their employer pays less than the new rate. For instance, if an employer pays 30p per mile, workers can reclaim tax on the 25p difference. The new rate applies to cars and vans, while lower rates exist for motorbikes and bicycles. Unions have expressed strong support for this increase, asserting that it provides necessary relief for frontline workers amid rising living costs. Unison's general secretary, Andrea Egan, highlighted the long-standing advocacy for this change and its immediate benefits for workers who have been financially disadvantaged by stagnant rates.