In this edition’s eNews, we look at the Prime Minister’s refusal to rule out further tax rises ahead of the upcoming Budget, a government review of business rates valuations affecting pubs and hotels, and figures showing government borrowing was higher than expected in July. We also cover concerns that proposals to criminalise certain tax mistakes could disproportionately affect low-income taxpayers, HMRC data revealing more than 240 cryptocurrency millionaires in the UK, and warnings that weak business investment is weighing on the country’s long-term growth prospects.
- Prime Minister refuses to rule out tax rises in upcoming Budget
- Government to review business rates valuations for pubs and hotels
- Government borrowing higher than expected in July
- Criminalising tax mistakes could hit low-income taxpayers
- 240 crypto millionaires revealed by HMRC data
- Growth outlook affected by weak business investment
Prime Minister refuses to rule out tax rises in upcoming Budget
Prime Minister Andy Burnham has refused to rule out tax rises in the upcoming Autumn Budget.
Mr Burnham recently stated that he ‘won’t be unrealistic’ in regard to the nation’s finances, adding that the public ‘needs to understand we are in a challenging position’.
The government will take a ‘careful approach’ to the economy, the Prime Minister confirmed. Economists have previously warned that the Chancellor will have little room to manoeuvre in the Budget on 28 October.
The Prime Minister has already taken action to help ease the cost of living by capping bus fares and cutting VAT on household electricity bills.
Mr Burnham said: ‘I will always take a careful approach to things. I ran Greater Manchester for ten years and we ran a very tight ship with rock solid finances.
‘Nothing will change as I come into this role as prime minister. I won’t take risks with people’s jobs or their livelihoods or their family finances.
‘I will try to help them in whatever way I can, I have already done some things that will help them.’
Press release: BBC
Government to review business rates valuations for pubs and hotels
The government will carry out a review of business rates valuations for pubs and hotels to improve fairness and transparency.
Pubs and hotels saw significant increases in rateable value at the 2026 revaluation due to the ending of pandemic-era valuations.
The review will help to ensure pubs and hotels can plan better for the future.
A Call for Evidence will make sure landlords, brewers and hoteliers are accurately represented in the review process.
The review will be provided to the Treasury by the end of March 2027 in time for the recommendations to be implemented at the next revaluation.
James Murray, Financial Secretary to the Treasury, said: ‘Last month we announced tax cuts for pubs to give them the breathing room they need. We’re going further with a rethink of valuations – so that we can build a fairer system for the future.’
Press release: HM Treasury
Government borrowing higher than expected in July
Data published by the Office for National Statistics (ONS) has revealed that government borrowing was higher than experts had anticipated in July.
Borrowing totalled £1.8 billion in July. Official forecasters had expected a surplus of £500 million – meaning that borrowing was £2.3 billion more than predicted.
According to economists, the higher borrowing figure will constrain Chancellor John Healey’s economic growth plans and limit Prime Minister Andy Burnham’s room for manoeuvre for reducing the cost of living on UK households.
The Chancellor said he will make use of ‘strong fiscal discipline’ at the upcoming Autumn Budget.
Responding to the data, Mr Healey said: ‘We are cutting the deficit faster than any other G7 economy, while giving people a bit of breathing space with cost-of-living pressures and focusing support to get young people into work.’
The Chancellor will deliver the Autumn Budget on 28 October.
Press release: Office for Budget Responsibility and BBC
Criminalising tax mistakes could hit low-income taxpayers
HMRC’s proposal to make it easier to prosecute taxpayers could have a detrimental impact on low-income unrepresented taxpayers, warns the Low Incomes Tax Reform Group (LITRG).
The LITRG has raised concerns that HMRC has failed to fully explain why its proposal for a new criminal offence for providing reckless, untrue statements is needed for ‘direct’ taxes like Income Tax, or how it would decide which cases to prosecute.
At present, HMRC can only seek criminal prosecutions where taxpayers have acted dishonestly. These proposals could make it easier for HMRC to reclassify genuine mistakes as ‘reckless’, meaning cases currently dealt with through civil enforcement could become subject to criminal proceedings.
LITRG says it is unclear how taxpayers could challenge this distinction, and warns that low-income, unrepresented taxpayers could be unintentionally caught out by the plans.
Joanne Walker, LITRG Technical Officer, said: ‘We are not convinced that HMRC has made the case for such a wide-ranging and serious measure. The consequences of these proposals are severe. A two-year prison sentence and an unlimited fine are serious and potentially life-changing sanctions to apply to acts that fall short of dishonesty.
‘We have a real concern about the effect these plans may have on low-income unrepresented taxpayers. They are least likely to be able to afford professional help, so least likely to be able to defend themselves against accusations they have acted recklessly.
‘They are also more vulnerable to being taken advantage of by certain unscrupulous tax advisers who could make false claims for tax relief on their behalf that HMRC could decide to prosecute further down the line.’
Press release: Low Incomes Tax Reform Group
240 crypto millionaires revealed by HMRC data
Declarations of over than £1 million in capital gains from cryptoassets in the 2024/25 tax year were made by 240 individuals, according to data published by HMRC.
The tax authority said the group accounted for a total of £717 million in cryptoasset gains during 2024/25.
This data is published as part of HMRC’s annual Capital Gains Tax statistics. It is the first time HMRC has published this specific data, following the introduction of a dedicated part of the self assessment return for cryptoasset capital gains.
In the 2024/25 tax year, there were 17,600 individuals making Capital Gains Tax-liable disposals of cryptoassets such as Bitcoin, Ethereum and Dogecoin, HMRC reported.
Collectively, these taxpayers reported total cryptoasset disposal proceeds of £13.8 billion and gains of £1.38 billion. The data also shows that around 87% of individuals reporting cryptoasset gains were male and around 13% were female.
James Murray MP, Financial Secretary to the Treasury and Paymaster General, said: ‘Taxes are due on cryptoasset gains just like any other gains, and we want to make sure people making gains from crypto know about what taxes they owe.
‘This important work is supporting the government’s efforts to close the tax gap, so that everyone pays their fair share towards our vital public services.’
Press release: HMRC
Growth outlook affected by weak business investment
The latest economic forecast published by the British Chambers of Commerce (BCC) has revealed that the growth outlook for the UK has been affected by weak business investment.
According to the BCC, GDP in 2026 is expected to grow by 1.0% (compared with 0.9% in the previous forecast), then 1.0% in 2027, rising to 1.3% in 2028.
The BCC expects inflation to peak at 3.6% by the end of the year, easing to 2.3% by the fourth quarter of 2027.
It also anticipates that business investment will contract by 0.2% in 2026 before recovering to grow by 0.4% in 2027.
Commenting on the forecast, David Bharier, Deputy Director of Economics and Insights at the BCC, said: ‘Our latest forecast paints an uncertain outlook for the UK economy. Businesses have absorbed another major geopolitical shock and shown real resilience.
‘But growth remains subdued, and rests on consumption, not investment. Net trade is also a drag in every single year of the forecast.
Press release: British Chambers of Commerce
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