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Stealth taxes, not wealth taxes, were the cornerstone of this Budget. The biggest losers are set to be Henrys and Henriettas — a shorthand for young professionals who are High Earners, but Not Rich Yet.

Two measures make this Budget particularly horrid for them. First, freezing income tax thresholds until 2031 will drag millions into higher-rate tax bands, with over 2mn expected to be snared by the £100,000 tax trap where an effective 60 per cent rate of income tax applies as the tax-free personal allowance is tapered away. This drops down to 45 per cent when their income exceeds £125,140.

Second, the chancellor’s decision to impose a £2,000 cap on what employees can salary sacrifice without paying national insurance will make it much harder for individuals to “pension away the pain” — a blow for Henrys and Henriettas trying to keep their take-home pay below this threshold in order to avoid punitive tax rates, and keep valuable childcare benefits.

In her speech, Rachel Reeves poured venom on financial services workers who sacrifice their bonuses into pensions free of tax and employer and employee national insurance contributions, saying this was “not sustainable for our public finances”.

There was no acknowledgment that their behaviour is driven by a distortive cliff edge in the tax system that successive chancellors have failed to address. The FT has reported on how a parent with two children at a London nursery whose pay went a pound over the £100,000 threshold would need to earn more than £149,000 to compensate for the value of lost childcare support.

Saving into a pension is a tax-efficient work around for those who can afford the hit to take-home pay. So too is going part-time or working fewer hours. If more Henrys have to follow the latter route in future, that could undermine UK productivity and lengthen NHS waiting lists as more doctors and consultants fall into the trap.

The one saving grace of this policy change? It won’t kick in until April 2029 in order to give businesses time to adjust, meaning employees about to be “fiscally dragged” into higher tax rates can continue to use the pension route for now. After this date, employers would have to pay a 15 per cent national insurance charge on salary sacrifice contributions that their employees make above the cap — although standard employer workplace pension contributions would thankfully escape the charge.

In practice, the administrative complexity of a cap could see employers decide they will not allow staff to sacrifice higher amounts. But this will increase the levels of tax complexity for individuals. Henrys could of course contribute to private pensions to avoid the £100,000 trap, but this would be much more fiddly and involve reclaiming higher or additional rate tax relief through a personal tax return.

“Couples where one parent earns above the £100,000 threshold are really worried about these changes,” says Philly Ponniah, a certified financial coach in London. “Yes, they have a high income, but they are spending an awful lot of money on childcare and many have seen their finances squeezed by higher mortgage payments.”

How employers might absorb the extra costs remains to be seen. The Office for Budget Responsibility assumes that over a third of the cost of salary sacrifice changes will be passed to employees through lower ordinary employer pension contributions, and a similar amount through lower salaries and bonuses — unwelcome news for ambitious Henrys and Henriettas. Plus, the compounding effect of lower pension contributions over time will hit the future value of their retirement pots.

If they do get a pay rise, many younger professionals face the additional impact of higher student loan repayments. Reeves slipped out that repayment thresholds and interest rates for Plan 2 student loans will be frozen for three years from 2027, meaning repayments will be calculated on a higher proportion of their income.

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High tax charges and mortgage interest rates mean that even high-earning Henrys in London and the south-east could struggle to get on the property ladder. Yet other Budget measures had further pain for the cash rich and asset poor who are trying to save for a property deposit. Those renting could see their landlords pass on the costs of an unexpected extra 2 percentage points of income tax, which will be applied to rental income from April 2027.

And while the over-65s will retain the ability to save £20,000 into a cash Isa and avoid being taxed on their savings interest after that point, this limit will drop to £12,000 for everyone else. As a further blow, any interest generated from savings beyond an individual’s personal savings allowance will also be subject to an extra 2 percentage point income tax charge.

Few will weep for the Henrys, but further complicating the tax affairs of tomorrow’s top performers can only blunt the ambition of a generation of talent. As for being “not rich yet”, they may never be rich at all.

Claer Barrett is the FT’s consumer editor; claer.barrett@ft.com; Instagram @Claerb