With the Autumn Budget taking place on 28 October, businesses are starting to ask the same question: where might the government look to raise revenue, and what could that mean for growth, investment and tax planning? While no major tax announcements have yet been confirmed, several themes are emerging from government statements, industry commentary and tax professional analysis.
The government has pledged not to increase Income Tax, VAT or employee National Insurance. But with spending pressures continuing and growth high on the agenda, many businesses are wondering where changes might come instead.
So, what are tax professionals keeping a close eye on ahead of Budget Day?
Why This Budget Matters
The Budget will be delivered against a backdrop of modest economic growth, ongoing public finance pressures and the government’s ambition to decentralise economic decision-making. Recent commentary suggests the Treasury’s fiscal headroom may be limited, increasing the likelihood of targeted tax changes rather than broad-based rate increases.
The new administration has already announced measures including the removal of VAT on domestic electricity bills, a £2 bus fare cap and business rates support for certain sectors, all of which create additional pressure on future revenue-raising decisions.
Will Corporation Tax Change?
For most businesses, corporation tax remains one of the most important areas to monitor.
Most signs point to corporation tax remaining at 25%, which should provide some welcome stability for businesses. The bigger question is whether any of the reliefs and incentives sitting behind it will change.
Businesses should pay particular attention to:
- Capital allowances
- Research and development incentives
- Sector-specific reliefs
- Investment-related tax measures
Even if headline rates remain unchanged, adjustments to reliefs can have a significant impact on effective tax rates.
Could Investment Get a Boost?
If the government is serious about boosting economic growth, investment incentives are likely to play an important role.
If growth is the priority, encouraging businesses to invest is likely to play a big role. That could mean fresh incentives for spending on technology, equipment and infrastructure.
Business leaders should therefore watch for announcements relating to:
- Plant and machinery allowances
- Technology investment incentives
- Green investment reliefs
- Manufacturing and infrastructure support
For businesses considering significant capital expenditure, Budget announcements in this area could influence the timing and structure of future investment decisions.
What about Employer costs?
While the government has ruled out increases to employee National Insurance rates, that does not necessarily mean employer-related taxes are entirely off the table.
Employment taxes remain a significant source of revenue, and businesses will be looking closely for any changes affecting:
- Employer National Insurance
- Salary sacrifice arrangements
- Benefits in kind
- Apprenticeship and workforce incentives
Given ongoing labour market challenges, any changes that increase employment costs would be particularly significant for growing businesses.
Is Capital Gains Tax in the Spotlight?
If there’s one area attracting the most speculation ahead of Budget Day, it’s Capital Gains Tax.
Several commentators have suggested that the government may revisit the taxation of wealth and investment gains, particularly given Prime Minister Andy Burnham’s previous comments regarding the balance between taxing work and taxing wealth.
The Chartered Institute of Taxation notes that CGT remains one of the most frequently discussed areas of potential reform, with some commentators advocating closer alignment between CGT rates and income tax rates. No changes have been announced, but the debate continues.
Any reform could have implications for:
- Business disposals
- Investment portfolios
- Shareholders
- Property investors
- Family succession planning
Business owners considering future exits should therefore be paying close attention to Budget developments.
What Could Happen to Inheritance Tax?
Inheritance Tax (IHT) continues to attract considerable attention.
There has been ongoing discussion around agricultural and business property reliefs, particularly following previous reforms. While no changes have been confirmed, reports suggest the government may review aspects of the current regime.
Tax advisers are therefore monitoring developments affecting:
- Business Property Relief
- Agricultural Property Relief
- Family business succession
- Intergenerational wealth transfers
For owner-managed businesses and family enterprises, any change in this area could have long-term planning implications.
Property Taxes: A Potential Source of Revenue?
Property taxation is another area attracting speculation.
Although Prime Minister Andy Burnham has reportedly ruled out immediate plans to abolish Stamp Duty, broader discussions continue around property taxation and how wealth held in land and property is taxed.
Areas that could attract future attention include:
- Stamp Duty Land Tax
- Council tax reform
- Property investment taxation
- Land-based taxation models
While substantial reforms may be politically challenging, property remains a sector that governments frequently revisit when seeking additional revenue.
Are Tax Reliefs at Risk?
History shows that governments do not always raise taxes by increasing rates.
Sometimes the focus instead falls on reducing reliefs, exemptions and allowances.
Tax professionals will therefore be watching for any changes affecting:
- Pension tax relief
- Investment reliefs
- Business tax reliefs
- Property-related reliefs
- Sector-specific incentives
Even relatively small changes to reliefs can meaningfully affect tax liabilities for both businesses and individuals.
Growth, Investment, and Regional Funding
One of the more distinctive themes expected in this year’s Budget is devolution.
Reports suggest the government is considering further fiscal powers for regional authorities, including retention of certain tax revenues and greater local decision-making powers. This reflects Prime Minister Andy Burnham’s stated objective of moving “money and power out of Westminster”.
Businesses operating across multiple regions may therefore wish to monitor announcements around:
- Regional investment incentives
- Local business taxation
- Economic development funding
- Infrastructure spending
These measures may not alter national tax rates but could influence investment decisions and regional growth opportunities.
What Else Could We See?
Budgets often contain unexpected announcements.
Potential surprise areas include:
- Sector-specific levies
- Changes to wealth taxation
- Restrictions on existing reliefs
- Targeted environmental taxes
- Additional incentives for investment and growth
While speculation is inevitable, it is important to remember that rumours frequently prove inaccurate. The detail ultimately matters far more than the headlines.
What Should Business Leaders Watch on Budget Day?
Business owners should focus on five key areas:
- Corporation tax and associated reliefs
- Capital allowances and investment incentives
- Employer tax costs
- Capital Gains Tax developments
- Inheritance and succession planning changes
The interaction between these measures could have a significant impact on business cash flow, investment decisions and long-term planning.
Final Thoughts
The Autumn Budget 2026 is shaping up to be one of the most closely watched fiscal events in recent years. With fiscal pressures mounting, growth remaining a priority and a new Prime Minister keen to establish his economic agenda, businesses should be prepared for targeted changes even if the government’s major tax pledges remain intact.
For now, the key message is simple: stay informed, avoid reacting to speculation, and be ready to assess the detail once the Chancellor delivers the Budget on 28 October.
The Budget can bring significant tax changes. If you’d like to discuss how potential developments could affect you or your business, speak to our tax team here.
This material is for informational purposes only and should not be relied upon as professional advice.
