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28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Chris Sanger, EY UK Tax Policy Leader, said:

“The Treasury today confirmed that the Finance Bill will deliver on the agreement in January to exempt US-headquartered groups from the global minimum tax. Whilst the impact of this agreement may be limited in the short-term due to local minimum taxes overseas, UK-headquartered businesses could find themselves disadvantaged if these taxes change. If this occurs, the Government would need to consider how to ensure that the UK remains a great place for businesses to be headquartered and listed, rather than just a place in which to invest.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Robert Pyle, EY UK&I Restaurant Sector Lead, comments on today's announcements in the Chancellor's Autumn Budget: 

“Restaurants will assess today’s Budget through the combined impact of its measures on labour costs, property costs and consumer spending. The sector has shown considerable resilience, but margins remain under pressure and operators have limited capacity to absorb further increases without making difficult choices around pricing, recruitment and investment.

“The increase in the National Living Wage will be particularly significant for restaurants, where labour represents one of the largest operating costs and businesses employ substantial numbers of younger and entry-level workers. While the announcement gives operators greater certainty over their wage bills for the year ahead, the increase will add to the employment cost base and keep productivity, workforce planning and recruitment firmly in focus.

“The additional support on business rates is therefore particularly relevant for hospitality, given the sector’s dependence on physical locations. The measures should provide welcome relief for some smaller operators and high-street businesses, although the impact will vary considerably depending on the size and rateable value of individual properties. For larger and multi-site operators, property taxes will remain an important part of the overall cost equation.

“Restaurants will also be watching the impact of the Budget on consumers closely. Measures aimed at supporting household finances could help support disposable incomes, but consumers are likely to remain selective about discretionary spending. At the same time, the increase in alcohol duty adds another cost for operators to manage, reinforcing the need to balance value for customers with protecting already constrained margins.

“Ultimately, the question for restaurant businesses will be whether today’s package gives them sufficient confidence and certainty to invest. While targeted support on property costs is welcome, operators are still managing significant labour and input costs.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Jamie Ratcliffe, Partner and Global Indirect Tax Leader at EY, said:

“The publication of the UK’s e-invoicing roadmap delivers the next tranche of detail as the UK moves towards mandatory e-invoicing from April 2029. In particular, the roadmap identifies when to expect more on the scope of the mandate, and the implementation, testing and onboarding phases. That clarity should help businesses plan the necessary investment and technology changes and resources, while allowing time for businesses in different sectors and of different sizes to understand how the new requirements will affect them. The announcement also confirms that public bodies and non-established taxable persons will be included in the scope of UK e-invoicing, significantly broadening the impact of the UK e-invoicing mandate.

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Chris Sanger, EY UK Tax Policy Leader, comments on measures for founders and entrepreneurs announced in the Chancellor’s Autumn Budget:

‘Business Asset Disposals’ will, at first glance, appear to be a setback for those looking to sell their businesses to others to scale up. This contrasts with the introduction of a more targeted ‘founders’ relief’, which seems aimed at a similar community. Perhaps the Chancellor thought that the original form of relief lives up to its acronym of being BAD? The real test of these two changes, and the other measures launched today, is whether together they encourage serial entrepreneurs to stay in the UK and reinvest.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Silvia Rindone, EY-Parthenon UK&I Retail Lead, comments on today's announcements in the Chancellor's Autumn Budget: 

Retailers will assess the Budget through its cumulative impact on costs

“Retailers and consumer businesses will likely assess today’s Budget through its cumulative impact on store, workforce and supply-chain economics, rather than any single headline measure. 

“Employment, energy, logistics, financing and business rates costs are increasingly interlinked. Consumer-facing businesses have demonstrated considerable resilience, but continued cost pressures are making decisions around pricing, hiring and investment progressively challenging. 

“The measures announced today provide greater visibility over the future cost base, including through the changes announced to business rates for smaller high-street businesses. For retailers, the detail around implementation and how the measures interact with wider employment, property and operating costs will now be important as businesses assess the implications for their investment and operating plans.” 

Business rates measures will have important implications for the high street

“The expansion of Small Business Rates Relief will provide welcome support for smaller retailers and independent high-street operators. Taking more smaller premises out of business rates altogether should improve the economics of operating on the high street and give some businesses greater capacity to invest. 

“However, larger stores and distribution networks are an integral part of the same retail ecosystem, so the broader test of the reforms will be whether they support investment in physical retail without simply shifting the burden elsewhere.” 

Online reforms could help create a more level playing field

“The decision to extend VAT liability for sales through online marketplaces is an important development for retailers and consumer brands. Making online marketplaces responsible for collecting VAT on a wider range of third-party sales are intended to make it harder for non-compliant sellers to gain a price advantage over businesses that meet their tax obligations. 

“The practical test will be implementation. The new rules will need to strengthen compliance without creating disproportionate complexity or additional costs for legitimate smaller businesses trading through online platforms.” 

Employment costs remain a major consideration

“Employment remains one of the most significant costs for large parts of retail, particularly across stores, fulfilment, customer service and distribution. 

“Today’s announcement on the National Living Wage gives retailers greater clarity over their employment costs for the year ahead. However, while the increase is more measured than businesses have experienced in some recent years, it will still add to the cost base of a labour-intensive sector. 

“Retailers will therefore continue to focus closely on productivity, workforce planning and the economics of individual locations. 

“For businesses making hiring decisions, certainty around future employment costs is particularly important.” 

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Chris Sanger, EY UK Tax Policy Leader, comments on the Chancellor’s Autumn Budget:

“The Chancellor delivered on his promise of a “steady as she goes” Budget, with targeted measures to ease challenges for many. But some businesses were still hoping for a “ready, steady, go” one, with measures that could help to unlock further growth and boost the economy.

“With the notable exceptions of banking and gaming, and ignoring the cash-flow effect of deferring relief for capital investment, the consistency in approach to business tax policy will be seen as a welcome contrast to recent Budgets. This should help to increase confidence in the predictability of the UK as a place to invest in and from.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Peter Arnold, EY UK Chief Economist, comments on the economic implications following the Chancellor’s Autumn Budget:

“Faced with the economic impacts of the conflict in the Middle East, and bound by many of the same fiscal and political constraints as his predecessors, the Chancellor has opted for a Budget that prioritises targeted interventions to support households with the cost of energy, while leaving many of the longer-term challenges still to solve at a later date.  

“The UK economy has so far proved relatively resilient in the face of rising energy prices, meaning the Office for Budget Responsibility (OBR) has actually upgraded its growth forecast for this year, albeit only to a small extent. However, resurgent inflation, weaker growth next year and substantial rises in the Government’s borrowing costs have almost halved the OBR’s estimate of fiscal headroom, even before accounting for additional policies announced in this Budget. Confronted with the increasingly challenging fiscal picture, the Chancellor has set out additional revenue raising measures, pushing the forecast tax burden to a fresh post-war record, partly rebuilding the lost headroom. Overall, the OBR also estimates that borrowing will be higher in every year of the forecast.

“A raft of smaller policy measures focused on bringing down the cost of energy for households and businesses will be mildly deflationary, reducing the peak of inflation by 0.2 percentage points next year, which will provide some slight breathing space for consumers and could help limit the four interest rate rises the market has been expecting from the Bank of England over the next 12 months. However, inflation is still expected to rise next year, and the persistent uncertainty around the conflict in the Middle East means this forecast could be out of date in just a few weeks.  

“Ultimately, this Budget has not provided answers to some of the bigger economic and fiscal challenges facing the Government, including welfare reform, defence spending and the longstanding challenge of weaker growth and productivity. £20bn of additional investment into state-backed financial institutions will help support the defence industrial sector, but tough decisions will ultimately have to wait for the next Spending Review. Meanwhile the Chancellor will be hoping that recent notable increases in the growth rates of private sector productivity growth and investment continue into next year, which would go some way to solving some of the economy’s most significant challenges.” 

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Richard Milnes, EY UK Banking Tax Partner, comments on the bank corporation tax surcharge increase announced in the Chancellor’s Autumn Budget:

“Today’s decision to increase the bank corporation tax surcharge from 3% to 6% comes after much speculation and will add approximately £1.5 billion to the future tax bills of banks operating in the UK. While it is temporary, the increase takes the combined headline rate of tax on banks' profits to 31% – a level not seen since the 1990s and notably higher than other major financial centres such as the US.

“This represents a calculated risk by Government to further tax a sector that already makes a considerable contribution to the Exchequer. By making this a time-limited increase, the Government has sought to strike a balance and manage the risk of any negative impact.

“Under the existing tax regime, public finances already benefit as banks grow and become more profitable – through corporation tax and the surcharge, in addition to employers’ NI and the Bank Levy. Put simply, a more successful UK banking sector generates higher tax receipts. That is why it is important the increase remains temporary: any extension beyond the announced 15 months could risk constraining investment and weakening the UK's competitiveness as a banking location, particularly at a time when the financial services sector is set to play a key role in the Government's growth ambitions.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Chris Sanger, EY UK Tax Policy Leader, comments on gambling tax announced in the Chancellor’s Autumn Budget

“The rise announced in today’s Budget to machine games duty comes without any formal consultation and could have significant implications for the sector. Although the proposal by an independent think tank resulted in lots of speculation and approaches to Treasury, this is no replacement for formal consultation. The betting and gaming environment in the UK is complex and duty increases can risk pushing consumers to illicit operators who have none of the protections to address problem gambling and pay no tax to the Exchequer.”

28 Oct 2026 | EY comments - Autumn Budget 2026

Budget 2026: Chris Sanger, EY UK Tax Policy Leader, comments on the new Pension Tax Allowance announced in the Chancellor’s Autumn Budget

“The move to exempt pensioners who receive only the state pension from income tax through a new Pension Tax Allowance will deliver a welcome saving in administration, but fails to address the underlying complexity in the income tax system. In a Budget that was notably constrained in terms of big policy changes, the Government has missed an opportunity to make some small ones, such converting the personal allowance to a tax credit. This alone could reduce tax administration for many and also remove the “tax trap” rate of 60% facing those earning in the band over £100,000. There is a case for a more strategic look at these administrative changes that could reduce the effort expended on all sides to make today’s complex tax system work.”