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United Kingdom

Chancellor John Healey presents first Autumn Budget with tax and spending changes

The Budget sets out tax reforms, higher debt forecasts and cuts to departmental capital budgets, affecting business, research funding and local tax powers.

Photo: Ugur Akdemir, Unsplash

What happened

Chancellor John Healey presented his 2026 Autumn Budget to Parliament on 28 October. UK Parliament+1 The Budget includes a temporary 3% Corporation Tax surcharge on banks and a new Founders' Relief offering 10% capital gains tax rates for innovative startups. Legal 500 Departmental capital budgets, which include research and development spending, will be reduced by a further 1 per cent from 2027-28 to 2029-30, on top of a 1 per cent cut announced in June. Research Professional News The Budget plans give local authorities greater control over tax revenues, including retention of all business rates revenues by the end of the decade and a share of locally generated income tax for mayoral authorities from 2028. pro-manchester

Around it

The Office for Budget Responsibility forecasts government debt will rise to 97.3% of GDP at the end of 2028/29, before falling to around 95.6% by the end of 2031/32. UK Parliament Public spending is higher in the latest forecast than in March 2026, mainly because of higher forecast inflation affecting debt interest and welfare spending. UK Parliament The Chancellor faced a manifesto pledge not to raise National Insurance, Income Tax rates or VAT for working people, which limited revenue-raising options. Legal 500

What comes next

Departmental spending in the final years of the forecast will be set in the 2027 Spending Review. UK Parliament

Sources

  1. UK ParliamentAutumn Budget 2026: A summary
  2. Legal 500UK Autumn Budget 2026
  3. Research Professional News‘Fresh hope’ doesn’t come from cutting research
  4. pro-manchesterFiscal devolution measures welcome in North West but the key is in delivery

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