The Chancellor’s decision to extend a freeze on income tax thresholds will disproportionately affect low-income households, according to two think-tanks. The Resolution Foundation reported that freezing income tax thresholds until 2031 will push over 1.7m workers into paying tax or into higher bands. Chief executive Ruth Curtice argues that raising income tax rates would have generated more revenue without harming low-to-middle earners, adding: “The manifesto tax pledge has cost working people.” “All but the top 10% of the income distribution are worse off because of opting for threshold freezes over rate rises,” Ms Cutice noted. Meanwhile, the National Institute of Economic and Social Research echoed these concerns, saying the extension of the income tax threshold freeze to 2030 “will fall disproportionately on the bottom half of the income distribution.” Craig Hughes, head of private client services at Menzies, said freezing thresholds “increases tax liabilities for millions by stealth, including those who would otherwise not be considered higher-rate taxpayers, and places a growing strain on working households.” Office for Budget Responsibility figures show the number of people paying the 40p rate of tax will rise from 7.2m this year to 8.9m in 2030/31. A further 1.6m will pay 45p in the pound, up from 1.2m currently.

British retailers have criticised the Government’s decision to delay the end of a tax break on low-value imports until 2029. Under the de minimis rule, overseas sellers can send goods valued at £135 or less direct to British shoppers without paying any customs duty. Retail leaders argue that the delay creates an unlevel playing field that benefits foreign competitors like Shein and Temu. British Retail Consortium CEO Helen Dickinson said: “The US has already removed its threshold, with the EU following suit next year. The Chancellor must take decisive action.” George Weston, chief executive of Primark owner Associated British Foods, said: “A commitment to close the customs loophole on low value imports that unfairly disadvantages the high street is positive, but this needs to be brought in rapidly.”

The Government has confirmed the continuation of its Digital Services Tax (DST) despite pressure from the US. The DST, a 2% tax on the revenues of multinational tech companies which has generated £800m from US tech firms, is expected to double by 2030. A Treasury review of the levy, published alongside the Budget, acknowledges that the tax may have raised consumer prices.

Former non-doms will benefit from a £5m cap on inheritance tax (IHT) for offshore trusts created before the abolition of their status. This change, introduced in the Budget, applies to trusts valued over £83m. Experts suggest the £30m cost to the Exchequer may be underestimated, as some trusts are worth hundreds of millions. Arun Advani, director at the Centre for the Analysis of Taxation, said: “This cap… is a giveaway to the tiny number of former non-doms who already revealed they didn’t actually want to go.” A Treasury source claimed the cap encourages ultra high net worth individuals to stay in the UK.

Homes in certain London postcodes are set to be hardest hit by the mansion tax on properties valued at more than £2m. The Institute for Fiscal Studies (IFS) reports that one in four properties impacted are in Kensington and Chelsea, Westminster, and Camden. Stuart Adam, senior economist at the IFS, noted that property values will likely decrease due to the expected tax payments.

The Institute for Fiscal Studies (IFS) has warned that UK households face a “truly dismal” outlook for living standards following the Budget. The IFS expects average disposable incomes to grow by just 0.5% per year over the next five years, with this far below historical norms. IFS director Helen Miller also said Labour has effectively broken its manifesto pledge not to raise taxes on working people, pointing to the freeze on income tax thresholds and a rise in National Insurance via limits on salary-sacrifice pension contributions. Chancellor Rachel Reeves denied breaking promises, telling BBC Radio 4’s Today programme that tax increases on workers were kept “to a minimum,” while Prime Minister Keir Starmer argued that the changes are “fair and necessary.” Ms Miller also suggested that the Chancellor “continues to shy away from meaningful tax reform that could move the dial.”

Experts have warned that the UK remains in a precarious fiscal situation following the Budget, despite Chancellor Rachel Reeves’ efforts to consolidate finances. Michael Saunders, a former Bank of England rate-setter who is now senior economic adviser at Oxford Economics, said the Budget “still leaves the UK with a relatively weak fiscal position,” noting concerns over issues including “low potential growth” and warning that the UK “is still not securely on a sustainable fiscal path.” Arun Advani, a director at the Centre for the Analysis of Taxation, said the tax changes set out by Ms Reeves “are unlikely to move the needle on growth much one way or the other.”

The Government has reversed its manifesto pledge to give workers protection from unfair dismissal from their first day in a job. Instead, the right will apply after six months, following pressure from business groups and opposition in the House of Lords. Ministers said the change was necessary to prevent delays to the wider Employment Rights Bill. While the Trades Union Congress welcomed the news, Unite questioned the decision, saying the Bill was now a “shell of its former self.” In a joint statement, business groups including the British Chambers of Commerce, the Confederation of British Industry, and the Federation of Small Businesses said the agreement “keeps a qualifying period that is simple, meaningful, and understood within existing legislation.” Ministers, meanwhile, have announced that the Fair Work Agency, which will be tasked with overseeing the new rights, will be set up in 2026.

Start-up founders have been given a boost from the Budget after Chancellor Rachel Reeves announced measures to support the ecosystem, including increased enterprise management incentives share option limits and a three-year stamp duty exemption for companies listing in London. Dom Hallas from the Startup Coalition said measures in the Budget were “emphatically” positive for founders. Russ Shaw, founder of Tech London Advocates, said: “The focus now should be on delivering these measures and creating a more stable, growth-oriented environment for business.”

Banks will pay £86m to the Financial Ombudsman Service (FOS) in the 2026/27 financial year, an increase of £16m. This rise is due to inflation and the £8m cost of the FOS’s Modernising Redress programme. The FOS expects to handle 188,000 cases in 2026/27. Case fees are set to rise for the first time in three years, with the standard fee rising 4.6%. The professional representatives charge will rise to £260, from £250. Jenny Simmonds, interim chief executive of the FOS, said that the year ahead is “crucial” for the service, with it aiming for a more agile and modern approach. Earlier this year, Chancellor Rachel Reeves confirmed a crackdown on the FOS, saying there were plans for it to be “returned to its original purpose as a simple, impartial dispute resolution service.”

The Office for Budget Responsibility forecasts that business investment will decline by 0.4% next year due to weak corporate sentiment and high interest rates, marking the first drop since 2020.

London Stock Exchange CEO Dame Julia Hoggett says UK companies are offering increasingly competitive executive pay to attract talent, with FTSE 100 median salaries rising 11% to $6.5m in the past financial year.

Shoppers are expected to spend £3.4bn during Black Friday sales, according to VoucherCodes.co.uk. Overall spending for the Black Friday period is projected to rise 1.5% to £6.4bn, PwC analysis shows. The average spend per person is anticipated to increase by 13% to £262. Jacqueline Windsor, head of retail at PwC UK, said: “While the overall interest in Black Friday has softened, spending per head is set to rise.”