The Office for Budget Responsibility (OBR) has revised its estimates on the impact of the Government’s salary sacrifice cap, indicating that up to 4.3m additional workers could be affected. The £2,000 cap, which was announced by Chancellor Rachel Reeves in the Budget and applies from April 2029, is expected to raise £4.8bn in its first year. The OBR noted “significant behavioural uncertainty,” as employers may alter their schemes, potentially leading to lower wages and higher contributions. While Government analysis suggests that 3.4m workers who pay into their pension using salary sacrifice would be affected, the OBR said the remaining 4.3m could be impacted, depending on how businesses responded. The Treasury insists that 95% of workers earning under £30,000 will be protected but Steve Webb, a former Pensions Minister, warns: “We could see millions of people on modest incomes losing out.”

HMRC’s plan to expand Making Tax Digital (MTD) risks faltering unless the Government convinces small businesses that digital tax tools are affordable and manageable. SMEs, which make up 99% of UK firms, already spend around £63,000 a year on financial administration but fears over cost and complexity are slowing further digital adoption. Analysis from Starling Bank shows that while 84% of SMEs use some digital tools, nearly half do not plan to increase usage. This is despite evidence that digital invoicing and tax tools cut time spent on such tasks by 41%. Analysis shows that many SMEs vastly overestimate the cost of digital tax software. Starling estimates wider digital uptake could add £25.3bn to the economy and £10.4bn in extra tax receipts. However, MTD has already cost £850m since 2015, and the National Audit Office says it has yet to show clear productivity gains.

A prominent European economist believes that Britain may soon consider a wealth tax. Gabriel Zucman said that while French President Emmanuel Macron has paused plans for a tax on the wealthy, interest in the idea was “bubbling up everywhere.” Mr Zucman has proposed a 2% annual levy on the wealth of any French taxpayer with assets of more than €100m, which he says would raise revenue equal to 0.8% of France’s GDP. In the UK, Green Party leader Zack Polanski has put forward a proposal for a 1% tax on assets above £10m and 2% on assets exceeding £1bn, saying this would raise £14.8bn a year. Chancellor Rachel Reeves previously noted that “we already have taxes on wealthy people,” adding: “I don’t think we need a standalone wealth tax.”

HMRC has issued a reminder that more than 860,000 sole traders and landlords must prepare for the new Making Tax Digital for Income Tax rules starting on April 6. Those with self-employment and property income exceeding £50,000 will need to maintain digital records and submit quarterly updates to the tax office. It is noted that the Government will not impose penalty points for late submissions during the first year of the new system.

The Bank of England has held interest rates at 3.75%, with the Monetary Policy Committee voting 5-4 to keep the base rate at the lowest level since February 2023. The Bank has indicated that future rate cuts are “likely” due to a slowdown in inflation. Governor Andrew Bailey suggested that inflation, which currently stands at 3.4%, is likely to get closer to the Bank’s 2% target in the coming months. He added: “All going well, there should be scope for some further reduction in the bank rate this year.” While inflation is expected to drop, economic growth is forecast to be weaker, with unemployment projected to rise to 5.3%. Matt Swannell, chief economic adviser to the EY Item Club, said that while there were “no promises made” on when the Bank may cut rates again, “such a closely balanced vote split clearly opens the door to a rate cut at the March meeting.” Suren Thiru, of the ICAEW, said high borrowing costs represent a “disheartening setback” for businesses and households.

The UK’s construction sector is showing early signs of recovery, according to the latest Purchasing Manager’s Index (PMI) from S&P Global. The PMI rose to 46.4 in January, up from 40.1 in December, indicating a slower decline in activity. However, it remained below 50, which marks the growth threshold, for the thirteenth month in a row. Job losses continue, marking 13 months of reductions, with house-building remaining the weakest segment at 39.3. Tim Moore, economics director at S&P Global Market Intelligence, said: “Construction companies noted subdued underlying demand… but there were some reports of improving investment sentiment.” Despite challenges, 38% of firms expect output to rise this year.

Interest in degree apprenticeships is surging as students seek stable career paths amid a decline in graduate job opportunities. According to education platform Higherin, searches for apprenticeships have doubled in the past year, with a 78% increase already recorded in 2026. Oliver Sidwell, founder of Higherin, said: “The conversation has moved from ‘you can do this if university isn’t for you’ to ‘this is a serious route with real career prospects’.” Institute of Student Employers data shows that graduate roles fell by 8% last year while apprentice hires increased at the same rate. The institute predicts a further graduate vacancy drop of 7% this year, with apprentices set to increase by 1%.

Complaints to the Financial Ombudsman Service (FOS) fell to the lowest level in two years in Q4 2025. Between October and December, the FOS received 47,300 complaints compared to 68,400 in the closing quarter of 2024. The decline comes after an overhaul of rules from regulators and Treasury that means professional representatives now incur a £250 fee for cases beyond the first ten in a financial year. Under the new system, banks face a £650 fee after three complaints. The FOS said the changes have led to “better evidenced complaints” from professional representatives. Data shows that fewer cases are being withdrawn or abandoned. While nearly a third of complaints were withdrawn or abandoned in the last financial year, the rate fell to 19% from April to December. The Financial Conduct Authority’s pause on motor finance complaints has also led to a fall in cases.

The Times reports that bridging loans are becoming an increasingly common tool for homebuyers navigating slow property chains, offering speed and certainty in time-sensitive purchases. The short-term loans, which typically last around a year and carry higher interest rates, rose 108% between 2020 and 2024, according to the Financial Conduct Authority. By effectively allowing buyers to act as cash purchasers, bridging loans can secure properties that might otherwise be lost, though experts warn of the high costs and risks if the sale of the original property is delayed.