Briefing for Suffolk Chamber Members Autumn Budget 2025

Executive Summary

The Autumn Budget on Wednesday 26 November, confirmed a number of lobbying successes from Suffolk Chamber. These included a new targeted advance assurance offer for firms claiming R&D Tax Relief and an exemption for the horse racing industry on gambling tax increases.

It also delivered several other wins for Suffolk businesses including the extension of the age cap for fully funded apprenticeship training for SMEs from under-21s to under-25s, and confirmation of lower business rates multipliers for businesses on the lowest multiplier, including additional reductions for those in the retail, hospitality and leisure sectors.

However, it missed multiple opportunities to boost regional growth and further support businesses, including investment for major capital projects, such as the Ely/Haughley rail junctions and improvements to the A14 in Suffolk, including the Copdock Interchange; significant reform to initial proposals for Agricultural and Business Property Relief for Inheritance Tax; and the replacement of Business Rates with a taxation system based on outputs, such as on sales or turnover.

Announcements of relevance to Suffolk Chamber members

Additional customs duty to be applied to parcels of any value

• This change aims to boost trade for high street businesses by making some online orders more expensive to deliver for overseas sellers from March 2029 at the latest.

Advance Tax Certainty Service

• For major investment projects of £1bn+, from July 2026, there will be a service which UK and non-UK firms can apply to keep an agreed interpretation of tax law to the project for five years across Corporation Tax, VAT, Stamp Taxes, PAYE, and the Construction Industry Scheme. Clearances will be binding on HMRC.

Business rates reform

• The shift from two business rates multipliers to five, including two new multipliers for those in the retail, hospitality and leisure sectors was confirmed. This change reduces business rates for most businesses, except for those with properties with rateable values of £500,000+ from April 2026.
• However, there will be a £4.3bn support package, including transitional relief, to help businesses of all sizes manage changes where they receive a large increase in bills.
• The government has also published a call for evidence on the role that business rates play in investment.

Capital allowance changes

• From 1st April 2026 for Corporation Tax, main rate writing-down allowance on the main pool of plant and machinery will reduce from 18% to 14% per year. However, from January 1st 2026 there will now be a 40% allowance to allow businesses to write off more of their upfront investment costs.

Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) limits and tax relief

• From 6th April 2026, companies can raise twice the amount of money from investments as they are currently able to under the EIS and VCTs.
• VCT investor income tax relief will fall to 20% from 30%.

Fuel duty and new EV duty

• Current 5p cut maintained until September 2026. Fuel duty will then rise to 1p on 1 September 2026, 2p on 1 December 2026 and 2p on 1 March 2027 with the government uprating fuel duty rates by Retail Prices Index (RPI) from April 2027.
• There will also be a new pay-per-mile duty for electric (3p per mile) and hybrid (1.5p per mile) vehicles from April 2028.

Harsher penalties for filing corporation tax returns late

• Penalties have doubled from their current levels for returns for which the filing date is on or after 1st April 2026.

Horse racing industry exemption from new Gambling Tax rise

• The current Gambling Tax rate will continue to apply for the horse racing sector.

Inheritance tax changes

• The government will now allow any unused allowance for the 100% rate of Agricultural Property Relief and Business Property Relief to be transferable between spouses and civil partners from 6th April 2026.

International student levy

• A new international student levy will require higher education providers to pay a flat fee of £925 per international student per year from 1st August 2028. All providers will be given an allowance for the first 220 international students per year, for whom they will not pay the charge.

Minimum wage increases

• Increases to the minimum wage have been confirmed, which will rise to £12.71 (national living wage, 21+), £10.85 (for those aged 18-20), £8 (apprentices and those 16-17) in April 2026.

New R&D tax relief advance assurance service

• In Spring 2026 HMRC will launch a limited pilot of a new targeted advance assurance service for those claiming R&D tax relief given feedback that the current advance assurance service is too narrow and inflexible. While the pilot runs, the existing advance assurance offer will continue. Any SME planning to claim R&D relief will be able to apply to take part in the pilot, and it will not be restricted to first-time claimants.

Overnight visitor levy

• The government is giving the new Norfolk and Suffolk mayor, who will be elected in May 2026, the option to create local overnight visitor levies, the design of which they are now consulting on.

Salary sacrifice pension contributions

• Salary sacrifice pension contributions above £2,000 will face National Insurance contributions from April 2029. Above that, contributions will be taxed the same way as other employee contributions to pensions; employers will therefore pay NICs at a 15% rate for salary sacrifice pension contributions above £2,000.

Sizewell C reclassification

• Sizewell C has been reclassified as Mega Projects Capital Annually Managed Expenditure, and income generated will be recognised through the Regulated Asset Base levy.

Skills

• Funding for training for under-25 apprenticeships to be fully funded and completely free for SMEs, an extension from provision for under-21s currently.
• Youth Guarantee: the government will guarantee a six-month paid work placement for every eligible 18-21 year old who has been on Universal Credit and looking for work for 18 months. This will cover 100% of employment costs for 25 hours a week at the relevant minimum wage, and additional wraparound support.

Conclusions and implications for Suffolk businesses

While it is positive for members that no more significant business taxes were announced, there is little evidence in this Budget of the strategic, transformational changes needed for sustainable growth, and some businesses will find the increases to minimum wage, and changes to salary sacrifice schemes will add to the pressures that they are already facing. Investment in major projects such as the Ely/Haughley rail junctions – which would deliver £5 for every £1 invested – and improvements to the A14 in Suffolk, including the Copdock Interchange, have been neglected by the government yet again. This is despite the pressures that Sizewell C will continue to place on Suffolk’s transport infrastructure.

There are some developments benefitting Sizewell C stakeholders however, with its reclassification meaning risks of delay to the project caused by funding limits will be reduced, and contractors will be given more certainty that money is available. The proposed Advance Tax Certainty Service may also have a positive impact for contractors involved in Sizewell C’s construction and financing, as firms may be able to apply to lock-in agreed interpretations of tax law, reducing risk of unexpected tax liabilities.

Some of the changes to business rates multipliers are welcome, including the confirmation of lower business rates multipliers for most businesses, and an additional reduction for the retail, hospitality and leisure sector. However, this Budget has been a missed opportunity to reform business rates so that they are based on outputs, such as sales or turnover. Businesses in particular sectors, such as food & drink manufacturing and freight & logistics may be disproportionately affected by the new higher multiplier, which the government imply will only affect large distribution warehouses, such as those used by online giants.

There were a number of wins following the Chamber’s lobbying efforts. These include the horse racing industry’s exemption from the rise in Gambling Tax, the new targeted advance assurance offer for firms claiming R&D Tax Relief and last-minute reforms for spouses and partners inheriting agricultural and business properties. However, changes to the proposals announced last year could have gone much further on Inheritance Tax to reduce the concern to many family-owned farms and businesses in Suffolk.

The extension to under-25s of fully funded apprenticeship training for SMEs represents a constructive development for education and training in the county. However, the new international student levy may provide new financial risks for Suffolk’s higher education sector if foreign students are subsequently deterred from studying in the UK.

While there have been some positive announcements, and the Budget has not been an overall disaster for Suffolk businesses, much of our membership remain under significant pressures and the sum of collective changes do little to change that fact.

Suffolk Chamber of Commerce will continue to monitor any developments and provide support to our membership as they navigate the implementation of the Chancellor’s announcements.

Joseph Clay, Policy Officer
Suffolk Chamber of Commerce
[email protected]
28 November 2025