“The message was that this would be a steady Budget. With little damaging speculation in the run up, relatively minor commitments and few gimmicks, today’s was largely a “steady as she goes” budget which will give the Chancellor the breathing space he needs for big decisions in the 10-year plan and Spending Review.

“Amid the geopolitical uncertainty hitting the economy, today’s measures will help households and businesses navigate their finances. In particular, the Budget gives welcome room for entrepreneurs to start and scale businesses, and to give those with side hustles extra space to keep what they’ve earned. Before the Budget we called for no additional taxes on taking on staff and some relief on business rates, so companies will be pleased on that front.

“While the measures announced today did not add too much complexity into the tax system, ICAEW Chartered Accountants tell us that businesses find continual yo-yoing on capital allowances and other reliefs unhelpful and prize stability over changes. As he looks beyond his first 100 days, the Chancellor should continue to support business to deliver growth and unlock investment.”

Commenting on the economic impact of today’s Budget, Suren Thiru, ICAEW Chief Economist, said:

“The OBR’s latest forecasts offer markedly more storm clouds than sunshine, with this year’s marginal growth upgrade lost in a fog of painfully weaker growth in later years amid rising inflation, higher interest rates and squeezed fiscal headroom.

“The minimum wage increase is a double-edged sword. Though it could help ease cost-of-living pressures for some workers, it may dampen hiring by raising employment costs, particularly as businesses continue to shift towards greater automation.

“While the Budget contained several short-term fixes, the lack of significant measures to tackle the structural barriers holding back economic growth leave the UK vulnerable to external shocks at a time when fiscal headroom remains under pressure.

“This relatively low-key Budget likely contains enough fiscal discipline to keep the UK off global bond markets’ radar for now, clearing the way for rate-setters to begin gradually raising interest rates, almost certainly starting next week.”

Commenting on the tax measures announced in the Budget, Frank Haskew, ICAEW Tax Director, said:

“While this was a low-key Budget without large-scale tax changes, there were a number of measures that will affect some taxpayers.

“There are increases in income tax for property and savings, which will see the rate increase from 20% to 24%, even before the 22% rate that was due to come in from April 2027.

“However, the Making Tax Digital soft landing – which means there won’t be penalty points for a year for MTD joiners from April 27 – will be of benefit to those due to come into scope.

“The proposed new founders’ relief is important, and we hope should help to encourage businesses to go for growth. However, overall, these measures are unlikely to make much difference to the total tax take, and underline the “steady as she goes” position adopted by the Chancellor.”

ENDS

Notes to editors: