In this edition’s eNews, we look at the Chancellor’s first Autumn Budget and the subsequent reaction from business groups. We also cover consent being given for gas production at a new North Sea field, specific Budget announcements for entrepreneurs, the implementation of new measures from the Employment Rights Act concerning harassment and trade union rights, and a new report from the Institute of Directors on the relationship between business behaviour and its societal impact.
- Autumn Budget announcements
- 2026 Autumn Budget – the business reaction
- Jackdaw gas field to boost UK’s energy security
- Budget 2026: changes for entrepreneurs
- New elements of Employment Rights Act 2025 implemented
- Can business be a force for good?
Autumn Budget announcements
Reiterating Labour’s message for ‘growth in every postcode’, the Chancellor of the Exchequer, John Healey, delivered his first Budget on 28 October 2026.
A further two percentage point increase was announced to the Income Tax rates for property and savings income from April 2027. The rates applicable to property and savings income from 2027/28 will be 24% in the basic rate band, 44% in the higher rate band and 49% in the additional rate band. No changes were announced to other Income Tax rates. The freeze of the Income Tax Personal Allowance, higher rate threshold and additional rate threshold will remain until 5 April 2031.
The annual cash Individual Savings Account (ISA) subscription limit will be retained at £20,000 from 6 April 2027 (it was previously expected to reduce to £12,000 from this date). A new First Time Buyer ISA will be introduced from April 2029.
The new State Pension will increase to £13,037 from 6 April 2027 which is above the Personal Allowance. The government will introduce a Pension Tax Allowance in order to avoid recipients of the State Pension having to pay small amounts of tax.
From 1 April 2027, the National Living Wage will increase by 3.9% to £13.21 per hour. The National Minimum Wage for 18-20 year olds will also increase by 3.9% to £11.27 per hour and to £8.31 per hour for 16 to 17-year-olds and eligible apprentices.
In May 2026, the government announced a temporary 55p per mile rate for the first 10,000 business miles in a private vehicle which applied retrospectively from 6 April 2026. This has now been made permanent. In addition, the government is also increasing the rate above 10,000 business miles from 25p to 35p from 6 April 2027. Simplified mileage rates for self-employed individuals will be set at the same level.
The government is reducing the lifetime limit for capital gains eligible for Business Asset Disposal Relief (BADR) from £1 million to £500,000 for disposals made from 6 April 2027. For qualifying founders of high-growth, innovative companies, a new Founders’ Relief will be introduced from 6 April 2027, offering a reduced 10% Capital Gains Tax rate on up to £10 million of lifetime gains.
The main rate of Writing Down Allowances will be reduced by two percentage points from 14% to 12% from April 2027. The main rate First Year Allowance (FYA) will be increased from 40% to 50% for expenditure incurred on or after 1 January 2027.
The government will launch an expanded Enterprise Management Incentive 2 (EMI2, formerly Company Share Option Plan). EMI2 will double the value of tax-advantaged options employees can hold from £60,000 to £120,000 from 6 April 2027 and the exercise period will be extended from 10 to 15 years.
For the self-employed, the Trading Allowance will be tripled from £1,000 to £3,000 from 6 April 2027.
This Budget extended the temporary 0% rate of VAT on qualifying domestic electricity supplies in Great Britain for another three months, until July 2027.
A further £2.6 billion of support will be provided through the Household Energy Payment, with up to 20 million households in England receiving a direct £100 payment from January 2027 delivered through the council tax system.
Mr Healey said that:
‘My choice in the Budget today is to give families and businesses some breathing space now, and to begin the radical reform of energy to reduce bills in the future’.
Internet link: gov.uk
2026 Autumn Budget – the business reaction
Business groups have reacted to Chancellor John Healey’s Autumn Budget speech.
The Confederation of British Industry (CBI) said that the Budget ‘does not meet the scale of the Government’s ambition’. Rain Newton-Smith, Chief Executive of the CBI, said: ‘On the face of it, this Budget lacks the bold moves that would have made it easier for firms to invest, hire and grow.
‘Fiscal discipline matters, and the Chancellor is charting a path through difficult circumstances. At a time of exceptional geopolitical pressures, using some fiscal headroom to absorb genuine short-term shocks is preferable to loading additional permanent costs onto business and weakening investment.’
The Federation of Small Businesses (FSB) stated that the Autumn Budget ‘misses the mark’ on helping small firms with their costs and jobs.
Tina McKenzie, National Chair of the FSB, said: ‘This Budget should have been the moment to help small businesses with the soaring costs holding them back, and the taxes restricting job creation. Instead, they got nothing to ease sky-high energy bills and nothing to make hiring someone more affordable, while the increase in business rates relief excludes too many.’
Meanwhile, the British Chambers of Commerce (BCC) labelled the Budget as ‘a steady approach’ but warned growth was ultimately missing.
Shevaun Haviland, Director General of the BCC, commented: ‘This was a ‘steady as you go’ Budget, sending the right signals to business, but lacking big calls that would really shift the economic dial.
‘Most sectors will be pleased to have avoided any further taxes being piled upon them. But, overall, most businesses won’t notice this Budget at all.’
The Institute of Directors (IoD) said that business leaders will be relieved that the Budget ‘included no nasty surprises’. Jonathan Geldart, Director General of the IoD, said: ‘There is still some way to go for the Government to win back the trust of British businesses, who will be looking for measures and assurances in the upcoming Ten Year Plan that restore long-term confidence in the UK economy enabling them to invest and grow.’
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Jackdaw gas field to boost UK’s energy security
The Energy Secretary has agreed that consent may be given for gas to be produced at the Jackdaw field in the North Sea. Potentially supplying gas from the end of this month, Jackdaw is expected to increase domestic gas production by around 6% at its peak and add an estimated £2.9 billion to the UK economy.
Also announced was a new Energy Wealth Fund which will use revenues for North Sea oil and gas to support the green transition and make investments in renewable and low carbon energy projects.
The long-term aim is to reduce the UK’s reliance on gas for electricity and therefore exposure to volatile international gas markets.
Prime Minister, Andy Burnham said:
‘Our approach will ensure we can boost our energy security, back British workers, ringfence future North Sea proceeds to speed up the green transition, hit our ambitious climate targets and – crucially – bring down bills.’
Responding to the announcement, Ben Martin, Policy Manager at the British Chambers of Commerce, said:
‘With continuing conflict in the Middle East and significant concerns around energy security, the gas provided from Jackdaw will boost domestic supply.
‘Gas from Jackdaw is also significantly less carbon intensive than imported LNG, so it provides a double win, demonstrating the value of domestic production.’
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Budget 2026: changes for entrepreneurs
In his first Budget on 28 October 2026, Chancellor of the Exchequer, John Healey made several announcements relevant to entrepreneurs and small business owners.
Recent years have seen an increase in the rate of capital gains tax (CGT) on gains qualifying for Business Asset Disposal Relief (BADR) from 10% to 18%. Budget 2026 further limited the value of BADR by halving the amount of lifetime gains qualifying for the relief from £1 million to £500,000 for disposals made on or after 6 April 2027.
Instead, a new CGT relief called Founders’ Relief will be introduced for founders of and significant early investors in high-growth, innovative UK companies. The relief will apply a 10% CGT rate to qualifying disposals of shares up to a lifetime limit of £10 million of gains per individual.
Changes were also made to help entrepreneurs just starting out. From 6 April 2027, the Trading Allowance will increase from £1,000 to £3,000; where the allowance covers all income before expenses, the individual will not have to declare or pay tax on this income. For young entrepreneurs, the government will shortly pilot a Young Entrepreneurs Allowance, providing successful applicants with support towards their living costs during the first year of their business.
The government also confirmed that the previous increase to simplified mileage rates applicable to the self-employed to 55p per mile for business mileage up to 10,000 miles would be made permanent and the rate for mileage over 10,000 would also be increased from 25p to 35p per mile.
Responding to the Budget, Jonathan Geldart, Director General of the Institute of Directors, said:
‘We very much welcome the numerous measures intended to support British start-ups and scale-ups, such as the new Founders’ Relief, Young Entrepreneurs Allowance and EMI2 share incentives (as well as support for small brewers).’
Josh Toovey, Head of Policy and Research at IPSE, also welcomed the changes but said ‘there is still a long way to go’.
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New elements of Employment Rights Act 2025 implemented
On 30 October 2026, further measures from the Employment Rights Act 2025 concerning harassment and trade union rights took effect.
These reforms are part of the government’s Plan to Make Work Pay which is being delivered in phases to give employers, businesses and workers time to prepare.
The harassment measures included requiring employees to take ‘all reasonable steps’ to prevent sexual harassment of their employees including by third parties.
Additional powers were also given to trade unions including strengthening their rights of access and extending protections against detriments for taking industrial action.
However, the British Chamber of Commerce (BCC) has warned that issues may be caused as insufficient guidance has been issued to employers. For example, employers are still waiting for confirmation from the Government on practicalities around union access.
Patrick Milnes, Head of People and Work Policy at the BCC, said:
‘Businesses urgently need clarity on the new trade union access regulations, which have come into force today.
‘They have been given no guidance on how to apply them, which limits their understanding of how the rules will operate in practice…
‘If the government is set on introducing these new systems, then it needs to make it as easy possible for business to get onboard. The current approach is doing the exact opposite.’
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Can business be a force for good?
The Institute of Directors (IoD) has published a new report ‘Business: A Force for Good?’ looking at the relationship between business behaviour and its impact on society.
The impact that a business has on society is an increasingly key focus for stakeholders with 88% of IoD members and 78% of non-members believing businesses have a responsibility to contribute positively to society. The report found business is most likely to have societal value where it is ‘ guided by a clear purpose, supported by long-term investment and governed with a focus on culture, accountability and stewardship’.
The three headline recommendations are:
Business leaders and boards should set clear long-term goals beyond delivering financial return
Investment should be given with realistic timescales that support long-term outcomes
Policymakers and regulators should ensure that responsible business practices are commercially rewarded rather than a cost.
The report was prepared by an independent Commission. Chair of the Commission, Lord Rees of Easton commented:
‘Thriving businesses depend on strong communities, effective institutions, public trust and a stable operating environment. Business and society are fundamentally interconnected.
‘The Commission’s central conclusion is that long-term business success and wider societal benefit are mutually reinforcing. When purpose, governance, capital, culture and accountability are aligned, businesses are more likely to achieve both.’
Internet link: IoD
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