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The Budget, delivered today, was one of the most hotly anticipated political and economic moments in recent times due to the rife speculation around the nature and scale of tax rises, as well as the respective positions of the Chancellor and Prime Minister.
With growth weak – and a big fiscal gap to plug – it has seemed as though every possible tax measure has been on the table for months now, with the Budget described in the media today as a ‘smorgasbord of tax rises’. With spending and welfare cuts ruled out, and fiscal rules requiring borrowing to be on a downward trend, the question has not been whether taxes would rise, but which ones?
So, when the Office for Budget Responsibility (OBR) mistakenly published the economic and fiscal outlook report before the Chancellor had even risen at the Despatch Box, revealing all the details, the waiting was finally over: Growth downgraded across the Parliament by 0.3 percentage points and tax rises totalling £28.8bn, and income tax thresholds frozen until 2031.
Whilst the political fallout will inevitably be dominated by the leaking of the OBR report, the Budget itself contained some important changes for businesses to be aware of. And it’s not all doom and gloom. The priorities and capital investment set out in the Spending Review earlier this year remain unchanged, and this Labour Government is still banking on growth to materialise as one of its key priorities.
1. The Spending Review stands. What was announced in June remains, with the Chancellor outlining her priority to make, buy and sell more in Britain – protecting capital investment in infrastructure, and supporting targeted investments in key industries like advanced manufacturing, AI, semiconductors, small modular reactors, car manufacturing and defence industries.
2. Electricity prices are being cut for heavy industry. The British Industry Supercharger reduces electricity costs for around 550 energy intensive businesses, whilst a new consultation on the British Industrial Competitiveness Scheme aims to cut electricity bills for 7,000 manufacturers.
3. Business rates are changing, with a revaluation meaning some businesses like retail and hospitality will pay less, whilst others with higher rateable value (above £500,000) will pay more, such as those with big warehouses like online retail giants. These changes are coming in from 1 April 2026.
4. Mayors are getting £13bn for skills, business support, and infrastructure, as part of a big devolution package. Increasingly, big decisions are being made locally, including spending that directly impacts businesses.
5. Backing entrepreneurs and start-ups. The Chancellor announced measures to improve the UK’s support for its most cutting-edge businesses, driving competitiveness of capital markets, through a three-year exemption from stamp duty for companies listing in the UK. Reeves also announced changes to ISAs, with the cash limit being reduced to £12,000. Meanwhile, the Government will increase eligibility for Enterprise Management Incentives (EMI) – and equalise upfront tax relief offered by VCTs compared to EIS at 20%.
For businesses, the encouraging sign is that growth remains a central plank of this Government’s plan, with the Chancellor being clear that “growth is the engine that carries every one of our ambitions forward through stability, investment and reform”.
Lots of the much-wanted growth will be delivered locally by Mayors investing their newly devolved funds in skills, business support and infrastructure. Businesses need to engage more deeply with Mayors and the devolved authorities and not just focus on Westminster.
A smorgasbord of tax rises remains on the table for future fiscal events, which is why it is as important as ever to engage with government to ensure your arguments are heard at the highest level.
Though this has not been an easy Budget to deliver, it was designed to keep the Prime Minister and Chancellor safe politically from their own backbenchers, with no breach of the manifesto pledges and an increase in welfare spending to keep the left of the Labour Party at bay.
If your organisation wants to have a seat at the table and shape the priorities of this government, it needs to engage now, constructively and persuasively.
To explore what the Autumn Budget 2025 means for your organisation, contact us at [email protected].
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