Latest Budget predictions and speculation

A mistake by the ONS (Office of National Statistics) means government borrowing has been overpredicted by £3bn, as per The Guardian. This leaves Rachel Reeves with some wriggle room for her Autumn Budget spending.

The additional budget comes after a VAT error, which saw the
ONS confirm public borrowing estimates have been undercalculated by £200m-£500m a month since January 2025.

The chancellor is set to backtrack from plans to put large retailers in the top business rates band, the FT reports. Last year, the government proposed reforms to increase rates on properties with rateable values over £500,000 to fund a permanent discount for small retail and hospitality premises. The Treasury is said to be reconsidering, however, following complaints by retailers, including supermarkets, who warn that it would push up inflation on food.   

The poor state of the economy could protect businesses from further tax rises, the FT's Lex column suggests. While businesses "bore the brunt" of tax rises in last year's Budget, slow growth, persistent inflation and consumer caution may persuade the chancellor to look elsewhere. 

"A government desperate for economic growth has to pay attention when payroll numbers have dropped in all but one month since Reeves’ last budget speech," it argues. 

Whitehall sources told the Daily Mail that the Treasury is considering extending VAT to private healthcare and financial services, the paper reports, reneging on previous promises. In an interview with the BBC before her Labour Party Conference speech, the chancellor said that "the world has changed". In his interview with the broadcaster, however, health secretary Wes Streeting ruled out adding VAT on private healthcare, telling BBC Breakfast, "it's not happening". 

The Resolution Foundation has urged Rachel Reeves to break manifesto promises and cut NI to raise income tax by 2p, Sky News reports. The move would "level the playing field" for different forms of income, says the think tank, previously headed by MP Torsten Bell, who was drafted in in August to help write the Autumn Budget. The move would raise £6 billion, the think tank says, mostly at the cost of pensioners, the self-employed and landlords, The Telegraph notes. 

Speculation continues that Rachel Reeves will introduce a "taxi tax" in the Autumn Budget with the Telegraph warning of it "punishing rural residents" while The Sun says it would add to the cost of holidays due to the use of minicabs for rides to and from stations and airports. 

The Office for Budget Responsibility will downgrade its forecasts for productivity, making it harder for the chancellor to meet her fiscal rules, according to The Financial Times. "We don't know precisely what they are going to say on productivity, but we have been given indications there will be a downgrade," the paper quotes an unidentified government official as saying. The news makes tax hikes "all but guaranteed", says City AM.

The government's interim report on business rates reform promises changes in the Autumn Budget. The last Budget committed to lower rates for retail, hospitality, and leisure properties with rateable values under £500,000 from April 2026, but a higher multiplier for the "most valuable properties". The interim report commits to exploring a move "from a 'slab' to a 'slice' approach" (moving from a single multiplier applied to the full rateable value to increasing rates for successive bands). The report promises an update and details of the new multipliers in the November Budget, "taking into account the 2026 revaluation outcomes, local government funding, and the economic and fiscal context".

Proposed pension reforms could significantly reduce tax advantages for savers in the form of three options for the Chancellor, according to the i Paper. One suggestion is to standardise pension tax relief at 20%, removing the higher rates currently enjoyed by higher and additional-rate taxpayers. Another potential change is lowering the tax-free lump sum from pensions, currently capped at £268,275, with some experts recommending a new limit of £100,000. Additionally, the government may target salary sacrifice schemes, which allow employees to boost pension contributions in exchange for reduced pay, potentially curbing their use to raise revenue.

Rachel Reeves is considering proposals for a tax raid on GPs and other professionals that would raise almost £2bn a year, as per The Telegraph. The Treasury has been presented with plans to levy national insurance (NI) on partnerships as the Chancellor scrambles for ways to fill a £50bn black hole in the public purse. Such a move would impact 190,000 workers, with family doctors, lawyers, solicitors, accountants and financial advisers hit the hardest.

FCA figures show a surge in withdrawals from pensions, driven by fears of a Budget clampdown, according to the Mail’s This is Money. Numbers taking tax-free cash are up by a third, and values withdrawn up more than 70% in the last financial year. Evelyn Partners, which obtained the figures through a freedom of information request, says it’s currently seeing a surge of enquiries similar to last summer’s ahead of the October 2024 Budget.  

Rachel Reeves' search for revenue in the forthcoming budget is focusing on capital gains tax and introducing a gambling tax, according to a source speaking to The Independent. The paper also notes that the Chancellor has reiterated her promises not to increase income tax, VAT or employees' NI and to stick with her fiscal rules. 

The Autumn Budget date has been confirmed as Wednesday, 26 November 2025. Treasury sources said the end of November was in line with typical timing for an Autumn Budget, and leaves time for the “full process” with the OBR, the BBC reports. This will include as a first stage a new baseline forecast for the UK from the OBR later this month.

Households and banks are likely to “bear the brunt” of tax rises in the forthcoming Budget, according to Capital Economics. The economics consultancy calculates that Rachel Reeves will need to raise £18-28bn in the Budget to avoid breaking her fiscal rules. The government’s promise not to raise taxes on “working people” leads the consultancy to argue that a bank surcharge and a quantitative easing levy are the two most likely tax rises in the Autumn Budget.

The Prime Minister’s “mini-reshuffle” makes wealth taxes more likely, according to the Telegraph. Appointments included Baroness Shafik as the PM’s new chief economics adviser and Dan Tomlinson as exchequer secretary to the Treasury. Both have previously worked for the Resolution Foundation think tank formerly headed by Torsten Bell. The moves suggest “wealth taxes will be hard-wired into Rachel Reeves’s second Budget”, the paper’s economics editor writes.

The BBC blames the fall in bank share prices on Friday on new tax proposals by the Institute for Public Policy Research (IPPR). The think tank has suggested a new levy on the interest UK lenders receive from the Bank of England as part of its programme of quantitative easing. The IPPR said it amounts to a “subsidy of commercial banks”, and suggested a QE reserves income levy on them to raise £7-8 billion a year.

The Treasury is considering charging landlords national insurance on rental income, according to The Times. The move would reportedly seek to raise £2 billion by applying NI to property income, which is currently exempt. It is seen as “a significant potential extra source of funds”, according to insiders quoted by the paper, with landlords earnings considered “unearned revenue”.

The recruitment of MP Torsten Bell to help draft the Autmn Budget has prompted renewed speculation of tax rises to come. The Mail’s This is Money outlines seven previous tax raising ideas he’s had, from scrapping the residence nil rate band for inheritance tax and aligning capital gains and income tax rates to bringing down the VAT registration threshold to £30,000.

Limiting the tax-free lump sum individuals can take from their pensions savings could help the chancellor raise over £2 billion a year, according to the Telegraph. According to the paper, the idea will be among a list of money-raising proposals by civil servants to help the chancellor, as she seeks to cover a Budget shortfall of as much as £50bn.

Rachel Reeves is considering extending capital gains tax to high-priced homes, the FT reports. While people’s main residences have always been excluded from CGT, the chancellor is said to be considering a “mansion tax” on high-value homes that would see houses with values above a certain threshold losing the exemption, the paper reports.

The government may replace stamp duty with a new property tax the Autumn Budget, the Guardian says. The Treasury is reported to be considering options that include a new tax on the sale of homes worth more than £500,000 and overhauling council tax, potentially replacing it with a local property tax.

The Treasury is considering reforming inheritance tax rules on gifts, according to the Guardian. Changes could target the seven-year rule, under which gifts are free from IHT where the giver survives for this period afterwards, and under which IHT reduces on a sliding scale from three years onwards. 

Pantheon Macroeconomics predicts “back-loaded stealth and ‘sin’ tax hikes” as the chancellor seeks to cover a “£20B gap against headroom”. The economists suggest income-tax thresholds freezes and “either pension-tax or unspecified spending restrictions in 2029-30” will also play a role.