On the 26th of November 2025 The Chancellor of the Exchequer, Rachel Reeves, announced the Autumn Budget in the House of Commons.
The announcement was slightly overshadowed by an incident at the Office for Budget Responsibility (OBR) when they accidentally published the assessment of The Budget’s impact
earlier than scheduled.
Whilst this controversial action did not necessarily affect official proceedings in the House of Commons, it was
reflected in the UK stock market.
The Chancellor opened her speech by reminding the House that the Government is working to rebuild the economy.
She pointed to trade
deals with the US, India and the EU, planning reforms, an overhaul of the visa system and a change of fiscal rules to raise public investment to a four-decade high.
She reminded the House of Commons that working people demanded and deserved change and expressed determination that
the country would not return to austerity. The Chancellor also remarked that she is determined to continue her efforts to
cut the cost of living, cut debt and borrowing.
Below you will find a roundup of key changes:
Income Tax and National Insurance
The Chancellor announced Income Tax and National Insurance thresholds are
to be frozen for another three years from 2028.
This continues a freeze that was put in place by the previous Government but will see more people fall into higher tax bands. The Chancellor remarked whilst this decision will affect working people, the changes to the tax system will
make sure the more fortunate will contribute the most. The Chancellor also pointed out headline
rates of Income Tax, VAT and national insurance will not be going up.
Property and Council Tax
The basic and higher rates of tax on property, dividend and savings income are
each to go up by 2% points.
Pensions
From April 2029, there is to be a
£2,000 cap on the amount that can be put into a pension and shielded from National Insurance contributions through salary sacrifice. It was also announced that any contribution above that level would also be
taxed in the same way as other employee pension contributions.
ISA Reform
From April 2027, the annual ISA cash limit will be set to £12,000. Whilst this is a reduction from £20,000, The Chancellor said that The Government is to publish a consultation in early 2026 on putting in place a
newer, simpler ISA product to support first time buyers to buy a home.
Energy Bills
The Energy Company Obligation (ECO) scheme, which was a home insulation scheme introduced by the previous Government, is
to be scrapped; The Chancellor announced this action would cut household bills by an average of £150 as a result.
Two-child Benefit Limit
The Two-child Benefit cap to be abolished from April 2026. The Chancellor hinted it is the Government’s job to cut child poverty, but that the two-child benefit cap
had failed on its own terms as it had not cut the benefits bill but has led to child poverty going up. And so, The Chancellor announced
the scrapping of the two-child limit for Universal Credit and Tax Credit, costing the Treasury £3 Billion by 2029-30.
National Minimum Wage
Starting from April 2026, The Chancellor announced the minimum wage for 18 to 20-year-olds is to
go up from £10 to £10.85 an hour. The national living wage will also
go up from £12.21 to £12.71 an hour.
This boost for low-paid workers would be seen as another measure to help people with the cost of living.
Milkshake Tax
The Chancellor announced that
dairy-based drinks, like milkshakes and canned lattes, are
to be included in the sugar tax. Designed to tackle obesity, the levy currently applies to drinks with a sugar content of 5g per 100ml. However,
after a public consultation this is being cut to 4.5g per 100ml, meaning it could cover hundreds more products.
Fuel Duty and Electric Vehicles
The Chancellor announced that
fuel duty is to stay at its current rate for another five months at least. The rate has been frozen since 2010 and is planned to go up with inflation after September 2026, ending 15 years of freezes. The Chancellor also confirmed that there is to be
a new duty on electric cars, payable alongside Vehicle Excise Duty (VED).
This will be set at 3p a mile for electric cars and 1.5p for plug-in hybrids; and this is aimed at helping double the funding for road maintenance in England.
Schools and the NHS
Repeating what was in the spending review, The Chancellor pledged an extra £5 Million for secondary school libraries, as well as £18 Million
to upgrade playgrounds.
The Chancellor also remarked that a saving of £4.9 Billion from various efficiencies is to be spent on more nurses and GP appointments, together with
£300 Million investment into tech for the NHS to improve patient services and 250 new local patient health centres.
Welfare and Apprenticeships
The Chancellor confirmed that because of reforms to Universal Credit, a guaranteed 15,000 people will get back into work
. However, approximately £300 Million of taxpayer funding is to be
removed for those using their disability benefits to drive Motability vehicles; this includes putting VAT onto payments for higher-value cars and ending relief from insurance premium tax.
It was also announced that there is to be funding to make sure that apprenticeships are
free for small and medium-sized enterprises.
Tobacco and Alcohol
There were no new announcements to speak of here, as tobacco is
due to rise at 2 percentage points above the Retail Prices Index (RPI) measure of inflation, and alcohol is also to go up in line with RPI.
Increasing the duty on harmful products year-on-year would be seen as essential for the Treasury, as falling consumption of tobacco in particular shows revenue going down every year.
Growth and Inflation Forecasts
The Office for Budget Responsibility (OBR) has
predicted growth of 1.5% for this year, which is
up from the 1% it predicted in March.
After that, the forecast is for 1.4% growth next year and 1.5% every year thereafter until 2030.
That means that the forecast for every year from 2026 has been downgraded, as previous projections were for 1.9% in 2026, then hovering between 1.7% and 1.8%.
Meanwhile, it was forecast that inflation appears to be
running slightly hotter than was predicted in March; coming in at 3.5% this year compared with a forecast of 3.2%, then 2.5% in 2026, which is up from 2.1%.
This could be an issue for many households who are concerned about the cost of living, and the rise in prices is one of many ways in which they feel a squeeze in their daily finances.
Whilst the Chancellor has said many times in the past that they will tackle inflation, the budget does not currently show any measures to address this.
Government Borrowing
Borrowing in 2025-26 is predicted to be £138.3 Billion,
falling to £112.1 Billion the year after, then £98.5 Billion in 2027-28, £86.9 Billion in 2028-29, £67.9 Billion in 2029-30 and £67.2 Billion in 2030-31.
This means that borrowing will be slightly higher next year, but it is expected to be lower than forecast in March, then lower year-on-year to the end of the period in 2030.
Gambling Duty
The Chancellor announced that from April 2026, remote gaming duty, levied on online casinos, will rise from 21% to 40%, and Bingo duty is to be abolished. There will be a
new online-only rate of general betting duty, which is levied on operators’ income from sports betting. High street bookies will still pay the current rate of 15%; but
online, the duty will rise to 25%, with a carve-out for horse racing.
Casino gaming duty bands will be frozen.
The Chancellor advised these measures will raise more than £1 Billion a year by 2031.
Devolution and Regions
There will be £13 Billion of “flexible funding” for seven mayors to invest in skills, business support and infrastructure. An additional £370 Million for the
Northern Ireland Executive, £505 Million for the
Welsh Government and £820 Million for the
Scottish Government.
Energy and North Sea
The Chancellor announced she will work to remove the obstacles which are holding back the investment into nuclear power, based on a
report by John Fingleton. As well as the Budget, the Government is due to soon publish its
North Sea future plan, allowing new offshore fossil fuel projects to be able to go ahead; as long as they are linked to existing fields.
Business Tax
It was announced there is to be an expansion of entrepreneurial investment schemes, as well as a three-year stamp duty holiday on the purchase of shares in companies newly listed in the UK. The Chancellor is also due to launch a consultation
on
how to attract more entrepreneurs.
It was also announced that there will be a 40% allowance to let businesses write off more of their upfront investment costs. It was also announced that there will be permanently
lowered business rates for 750,000 retail, hospitality and leisure businesses, paid for higher rates on properties worth more than £500,000, used by “warehouse giants”.
There will also be £4.3 Billion support for
properties that receive a large increase in their bill. Customs duty will apply to parcels of any value; aimed at
stopping online retailers undercutting high street retailers on price.
Other measures that were announced included a
freeze in rail fares and
prescription charges; exempting payments from the
compensation scheme for the infected blood scandal from inheritance tax; and
reducing the Capital gains tax relief on shares sold by business owners.
At the time of writing, there were no immediate considerations in the Budget for the Charity Sector.
For
more information, or to read
the Budget Speech in full, visit the UK Government
website.