techUK reacts to the Autumn Budget 2025

28 Nov 2025 10:54 AM

Unveiling the second Budget of this government, Chancellor Rachel Reeves has announced further tax rises on businesses with limited support, and growth-driving measures offered in return. 

It was 12 months ago that the Chancellor significantly raised business costs through a series of tax rises including raising employer national insurance contributions (NICs). This was supposed to be a one-off occurrence to restore the public finances, but a year on and it is businesses that once again find themselves caught in the middle of a difficult Budget.  

That being said, there is some positive news for some tech companies in the sector, mainly investment-focused early stage and fast-growing organisations. 

Below, we have gathered the most significant announcements made recently.  

Starting, scaling, staying 

For entrepreneurs, start-ups and scale-ups there were a range of announcements including: 

• The Enterprise Management Investment Scheme: The government will increase company eligibility limits for Enterprise Management Incentives (EMI) to allow scale-ups to join start-ups in offering tax-advantaged shares. 
• The Venture Capital Trust Scheme: There will be a reduction to the upfront Venture Capital Trust Scheme (VCT) from 30% to 20%. 
• Tax support for entrepreneurs: A call for evidence has been launched on how the tax scheme can better back entrepreneurs and the impact of existing schemes.  
• Stamp Duty relief for new UK listings: New London Stock Exchange Listings will see a 3-year exemption on stamp duty.  
• Taxes on dividends, property and savings income: There will be an increase to the tax rates on dividends, property and savings income by 2%, increasing the basic and higher rates to 10.75% and 35.75% respectively.  
• Capital Gains Tax: From November 2025, Capital Gains Tax relief on disposals to Employee Ownership Trusts (EOTs) will reduce from 100% to 50%.  
• ISAs: Tax-free savings in a cash Individual Savings Account each year will decrease from £20,000 to £12,000 a year for under 65s - aimed at incentivising individuals to invest further in stocks & shares
• Public finance: The British Business Bank will invest at least £5 billion in growth-stage funds. 

Hiring and workforce  

In terms of attracting talent and retaining employees, the Chancellor announced: 

• National Living Wage and National Minimum Wage: National Living Wage and National Minimum Wage are set to increase above inflation rates. For over 21s (also NLW) it will increase by 4.1%, for 18-20-year olds it will increase by 8.5%, and it will grow by 6% for 16-17-year olds.  
• Employer National Insurance contributions: The employer National Insurance freeze will be extended for an additional three years, running from 2028/29 until 2030/31. This follows the earlier reduction of the threshold from 9,100 to 5,000 in the 2024 Autumn Budget.  
• Salary sacrificed pensions: Tax free salary-sacrificed pensions will be capped at £2,000 per year after which national insurance contributions will be applied treating them like ordinary employee pension contributions.  
• Investment into supporting employment and skills: Over the next three years, £820 million will be invested as part of the Youth Guarantee: Jobs Guarantee scheme to guarantee six-month paid work placements for 18-21 year olds who have been on Universal Credit and those who have been looking for at least 18 months. There will also be a £725 million investment for the Growth and Skills Levy which will support apprenticeships for young people and include a charge creating free apprenticeship trainings for under-25s for SMEs. 
• Higher education income levy from international students: A new levy on higher education income from international students will be introduced from the 2028/29 academic year, set at £925 per international student per year. The first 220 international students at each institution will be exempt, with the levy applying only beyond this threshold. 

Infrastructure and business rates 

• Business Rates: The government have confirmed they will move forward with plans to reduce rates on retail, hospitality and leisure businesses through increases to the rates for properties with a rateable value of over £500,000, making the high-value multiplier 50.8p in 2026-27. The government are also publishing a Call for Evidence on how Business Rates affect investment. 
• Transitional relief for business rates: As part of these plans, the Chancellor announced that there will be a Transitional Relief scheme for ratepayers facing large bill increases in 2026, with a maximum 30% relief for properties with a rateable value of over £100,000.  
• Planning funding: Funding of £48 million has been announced for MHCLG, DSIT and Defra over the next three years to boost capacity and capability in the planning system, including by reaching 1,400 recruitments across the planning system by the end of the current Parliament by expanding the Pathways to Planning Graduate Scheme and creating a new Planning Careers Hub to retain and retrain mid-career professionals. There are also plans to work with the judiciary to make further reforms to ensure planning cases are heard more quickly and by expert judges. 
• Grid connections: The Budget documentation announced that efforts would be made to prioritise grid connection for projects that require it. This will involve DSIT publishing a strategic plan for data centres in order to prioritise projects are taken forward. Government will also work with Ofgem to explore enhanced entry and membership requirements to ensure viable planning projects progress in the demand queue. 
• Gigabit connection: The Budget included long-announced plans from DSIT that they will be consulting on measures to create a new right for leaseholders to request a gigabit broadband connection and a duty for freeholders not to unreasonably refuse such a request. 
• Energy reform: As with the announcement of the British Industrial Competitiveness Scheme consultation on Monday, there is no energy support for digital infrastructure. However, a combination of the Energy Company Obligation scheme levy being repealed and 75% of the domestic costs of the Renewables Obligation being moved to general taxation will, until 2028/29 at least, will save households an estimated £150 on bills. 
• Nuclear eligibility for green financing: The government has published an updated Green Financing Framework alongside the Budget which has added nuclear energy to the list of eligible expenditure for green financing.  
• Nuclear policy going forward: The government has endorsed the recent Fingleton Report on the nuclear regulatory regime. The government will also legislate to give the Office of Nuclear Regulation the ability to consider overall strategic factors such as energy and national security imperatives in the delivery of its statutory purposes and there is a strategic steer from the Prime Minister which sets expectations for the civil, defence, and decommissioning nuclear sectors to accelerate safe and efficient delivery through proportionate regulation and stronger collaboration 
• Critical Minerals: In addition to the previously announced reopening of the South Crofty tin mine in Cornwall, the Budget committed to a £30 million fund for Cornwall to include investment in critical minerals.  

Other things to note… 

• E-invoicing and HMRC: The government have declared their ambition for VAT to be fully digital from 2029, with a roadmap to be published in 2026 to get there. This will also include support from government and Ofcom to help businesses access and adopt a gigabit connection. 
• HMRC digitisation: The Budget also included an investment of £59 million in new technology over the next five years to provide taxpayers with real-time digital prompts for VAT filing software from April 2027, and Corporation Tax filing software from April 2028. There is also a broad aim for 90% of HMRC interactions with customers to be digital by 2030. 
• NHS digitisation: An additional £300 million of capital investment for NHS technology was announced to support NHS investment in digital technology, including through increased investment in digital health records. 
• Digital ID: The OBR Economic and fiscal outlook report announced that the implementation of digital ID cards is set to cost £1.8 billion (£1.3 billion CDEL & £0.5 billion RDEL) over the next three years. The government claims to meet the costs through current Department Expenditure Limits budgets however specific funding has yet to be outlined. 
• Electric Vehicles Tax: There will be a new mileage-based charge on battery electric and plug-in hybrid cars from April 2028, raising £1.4 billion, alongside 100% relief for eligible electric vehicle charging points and electric vehicle only forecourts. A consultation on these measures was announced.  
• Ride-sharing taxi app VAT rise: The government have announced they will reform VAT to prevent ride-sharing apps paying a lower rate of VAT than others. 
• Customs on Low Value Imports: Government will remove the Customs Duty Relief on goods imported into the UK valued up to and below £135 by March 2029. There will be a consultation on new customs arrangements.

Click here for the full press release