Research for the Telegraph shows that a number of high-paid workers are turning down promotions, cutting hours or donating to charity to avoid the UK’s £100,000 tax threshold. The analysis saw 43% of managers say they or their employees have deliberately reduced income to avoid punitive tax rates. Frozen thresholds and growing awareness of a tax trap which removes childcare benefits and tapers the personal allowance – creating effective marginal tax rates of 62%, – have led many to boost pension contributions, use salary sacrifice schemes, cut hours, turn down promotions, retire early or donate to charity. Economists, tax experts and NHS leaders warn the cliff edge is irrational and damaging productivity. Petra Wilton, from the Chartered Management Institute, said: “When employees make those decisions, organisations lose experience and valued leaders, and teams feel the impact immediately.” Dan Neidle, a tax lawyer, told MPs on the Treasury Select Committee before the Budget that the threshold was “irrational” and harmed the economy, while the Institute for Fiscal Studies has previously described it as “absolutely insane.”

Paul Andrews, chief executive of Family Business United, says family firms, which constitute over 90% of UK businesses and employ 57% of the workforce, face significant challenges due to proposed tax reforms by Chancellor Rachel Reeves. He says the reversal of business property relief and changes to inheritance tax thresholds could force many family firms to sell or break up. Mr Andrews has warned that the policies could lead to job losses and harm local communities. He supports a judicial review to reassess the impact of the changes, advocating for a consultation with business leaders to protect family firms’ future.

Research for the Jobs Foundation reveals that 78% of family businesses in the UK are pessimistic about the economy in 2026. The survey indicates that many owners believe the current tax and regulatory environment is worse than that of the 1970s. Matthew Elliott, president of the Jobs Foundation, noted that 80% of firms “feel like the Government doesn’t understand what it is like to run a business,” adding that more than three-quarters “think successive governments have lacked the ambition to make the UK a really great place to do business.” Additionally, 68% of respondents doubt the Government’s commitment to economic growth.

CFOs at major UK firms are increasingly optimistic about technology investments and AI’s potential to enhance productivity. A poll from Deloitte shows that nearly 80% of CFOs expect improved business performance and productivity growth over the next five years. Richard Houston, CEO of Deloitte UK, said: “CFOs are significantly more positive about improving performance through deploying AI.” Despite rising risk appetite, external uncertainties remain a concern, with geopolitics cited as the top risk.

Research from the international schools group ACS reveals growing dissatisfaction among British workers, with nearly a quarter unhappy in their jobs and around 9% planning to quit in January. Many are considering career changes, with 41% expecting a career overhaul this year, including starting a business, retraining, or taking a sabbatical. The findings highlight broader concerns over low productivity, the impact of early career guidance, and a shift among younger workers prioritising job satisfaction over pay or progression.

Credit card spending in the UK rose sharply in November, reaching nearly £78bn, according to Bank of England data. Annual growth in credit card borrowing rose from 10.9% in October to 12.1% in November, with this the biggest increase since January 2024. The data also shows that borrowing using other forms of consumer credit – including car dealership finance and personal loans – rose by £100m to £1.1bn. Martin Beck, chief economist at WPI Strategy, said: “It remains unclear whether higher credit card spending reflects improving confidence or a greater reliance on credit.” Alex Kerr, UK economist at Capital Economics, said the data “adds to the evidence” that speculation over tax rises ahead of the Budget “didn’t influence households’ spending decisions too much.”

Chancellor Rachel Reeves has announced that the Office for Budget Responsibility (OBR) will release an economic forecast on March 3 but the Treasury watchdog will not evaluate the Government’s adherence to fiscal rules. Ms Reeves said the forecast “will fulfil the obligation required by the Budget Responsibility and National Audit Act 2011 for the OBR to produce at least two forecasts in a financial year.” The Government plans to respond to the forecast with a statement to Parliament, maintaining a commitment to one major fiscal event annually. Ms Reeves said this “gives families and businesses the stability and certainty they need and, in turn, to support the Government’s growth mission.”

FTSE 100 chief executives will earn more by midday today than the average worker will in an entire year, according to the High Pay Centre. The median annual pay for these CEOs is £4.4m, which is 113 times the £39,039 earned by the median full-time worker. This equates to £1,353.23 an hour. Andrew Speke, the interim director at the High Pay Centre, said: “The idea that executives, as a class, are individually contributing over 100 times more in value than the workers they rely on is simply not credible.” Paul Nowak, general secretary of the Trades Union Congress, commented: “While millions of low- and middle-income workers are still struggling with the cost of living, those at the very top keep helping themselves to a huge slice of the pie.”

Nearly 5.65m people have yet to file their self-assessment tax return before the January 31 deadline, according to HMRC. The tax office also noted that 342 individuals submitted their returns in the last hour of 2025. Over New Year’s Eve and Day, 54,053 people filed their returns.