Read the full report

Rachel Reeves rose for her first Spring Statement to a backdrop of pretty dire economic forecasts, be it borrowing, growth or stubbornly high inflation. Whilst there will be some sympathy for the Government, due to the volatility of world economies currently, we suspect it took all the Treasury’s accounting skills to balance the books and help the Chancellor to meet the government’s spending pledge.

As expected, the Statement centred around non-tax matters, including changes to welfare, defence and overseas aid spending. The Chancellor also announced an additional £2 billion for social and affordable housing for 2026/27, as part of the government’s plan to build 1.5 million homes in England in this Parliament, supported by reforms in the Planning and Infrastructure Bill.

With such seismic changes announced last year, such as employers’ National Insurance, the non-UK domicile regime and Inheritance tax, the Chancellor is giving individuals and businesses some time to recover, as well as the tax profession a pause for breath.

There appears to be general agreement that to stick to her borrowing rule and her target £9.9bn headroom by 2029/30, the Chancellor will have little room for manoeuvre. We shall look with interest to the performance of the economy over the next seven months to see if even more will be required of the UK taxpayer. As always, we will keep you updated of any relevant tax announcements and developments ahead of this year’s Budget.

Read full details of the effects of the changes on individuals and businesses here: Spring Statement Report 2025