Follow Chancellor Rachel Reeves announcements live

Startup leaders are responding positively to tax breaks for employees and investors unveiled by Finance Minister Rachel Reeves in the budget. 

“This Budget shows that the government has seriously listened to founders and tried to make things better to build and scale a startup in the UK,” Dom Hallas, executive director of lobby group Startup Coalition, told CNBC.

“Big progress on expanding share options, doubling the scale of the enterprise investment and venture capital trust schemes to back scaleups, and looking again at how entrepreneurs are incentivised in our tax system will make a material difference to founders building today and in the future.”

Measures announced by Reeves include doubling the annual limits of venture capital schemes — which allow tax breaks for investors in early-stage startups. From April 2026, investors will be able to invest up to £20 million a year in companies under the schemes, up to a £40 million lifetime limit.

Reforms to the enterprise management incentive (EMI) scheme were also lauded, with the size of scaleups being able to offer those tax share incentives for employees rising from 250 to 500 employees. Asset thresholds will increase from £30 million to £120 million.

“Through EMI reform, today’s budget has delivered meaningful change for Britain’s startups,” said Hannah Seal, partner at Index Ventures. 

“It will now be easier for companies to attract, retain and reward the talent they need to scale and compete globally — especially critical in an AI-first world where talent costs and capital requirements are higher than ever.”

— Kai Nicol-Schwarz

The U.K. Economic Secretary to the Treasury Lucy Rigby has conceded that productivity remains one of the most significant problems facing the country.

In a briefing immediately following Rachel Reeves’ Autumn Budget, Rigby said the chancellor is aiming to deal with the root causes of the U.K.’s productivity challenge, which data showed would reduce revenues by some £16 billion.

This includes “historic” levels of underinvestment, Rigby said, adding that the government is focused on creating conditions for future growth, highlighting the approval of key infrastructure projects in nuclear and AI.

“The Chancellor is doubling down on every effort to try and shift productivity in the right direction,” Rigby said.

Separately, Rigby also expects today’s measures around savings and listings would help the U.K. “break out” of its aversion to retail investment. She acknowledged this remains the lowest level out of all G7 nations, adding that changes to listings and prospectuses would help “turbo charge” the London stock market.

—Hugh Leask

As investors continue to digest the details of the Autumn Budget, Mark Preskett, senior portfolio manager at Morningstar Wealth, is taking a positive view on the outlook for British assets.  

“Today’s U.K. Budget has not derailed Morningstar Wealth’s broadly positive outlook for the U.K. equity and bond markets,” he said in an email. “Significant focus has been on the U.K. economy’s fiscal headroom and the improvement here, based on today’s OBR forecasts, is encouraging.”

He added that moderating U.K. inflation means gilt yields are likely to continue their downward trajectory “once the dust settles from the budget.”

“However, the U.K. dividend tax hike — which impacts our home market more than others given its higher payouts — is a clear disincentive for stocks and there was no mention of specific U.K. equity incentives within ISAs,” Preskett said.

— Chloe Taylor

In the wake of the budget, Invesco said U.K. government bonds, or gilts, are its “favored sovereign market now.”

“High government debt and political flip-flopping has weighed on U.K. gilts this year,” Benjamin Jones, global head of research at the investment firm, said in an email. “(But) we believe this budget has provided enough to ease those fears a little.”

Gilt yields were volatile before and during Reeves’ budget announcement, with the yield on the benchmark 10-year gilt last seen trading almost 6 basis points lower while yields on 30-year gilts fell by 10 basis points.

“With yields in the U.K. higher than many other developed markets and the Bank of England now having more reasons to cut, we think that gilt yields across the curve will fall,” Jones said. “Our fixed income team view the U.K. as one of the best places to take duration risk today.”

— Chloe Taylor

CNBC inboxes are choc-a-block with reaction to the Autumn Budget and the Office for Budget Responsibility’s assessment of public finances and the U.K’s economic outlook. Here’s a snapshot:

Reeves delivers ‘historic’ tax raising measures:
Sanjay Raja, chief U.K. economist at Deutsche Bank, said the budget delivered “historic” tax raising measures — and noted that Reeves was left with “larger headroom than anyone expected going into this forecast.”

“Put simply, the OBR projections were far better than we expected, with the impact of the productivity downgrade on the borrowing outlook far less than we and others anticipated,” he said.

‘Perilous’ outlook:
“Despite the positive spin from the Chancellor today, the fiscal outlook remains perilous,” Elliott Jordan-Doak, senior U.K. economist at Pantheon Macroeconomics, said.

“Some of the fiscal savings will fail to materialise, the government seems to lack the political power to push through measures necessary to stabilise the fiscal ship in the near-term, and we think defence spending will place further pressure on the sums.”

‘Significant fiscal tightening’ from the chancellor
“This represents a significant fiscal tightening that the U.K. economy will feel for the next five years,” Maxime Darmet, senior U.K. economist at Allianz Trade, said.

“Smaller taxes are harder to forecast and may underdeliver, potentially forcing the government to look for additional revenue later. On top of that, many of these new measures won’t take effect immediately, further weakening confidence in their impact.”

“As a result, financial markets are likely to stay uneasy, at least until the government sets out a more convincing and reliable tax plan.”

OBR error a ‘fitting end’ to weeks of leaked budget detail:
“The entire contents of the Budget being accidentally published by the OBR was perhaps a fitting end to the most leaked fiscal event in living memory,” Tom Selby, director of public policy at AJ Bell, said Wednesday.

— Holly Ellyatt

Kemi Badenoch, the leader of the opposition Conservative Party, has slammed Chancellor Rachel Reeves’ Autumn Budget, calling it a “total humiliation.”

In the opposition’s customary response to the chancellor of the day’s budget statement, Badenoch called the finance minister “utterly incompetent” and called for her to be sacked.

As for the budget statement, which contained a raft of smaller rather than headline tax rises, Badenoch described it as a “smorgasbord of misery.”

“Last year she put up taxes by £40 billion, the biggest tax raid in British history. She promised she wouldn’t be back for more, she swore it was a one-off. She told everyone that from now on, there would be stability and she would pay for everything with growth,” Badenoch said, addressing lawmakers in the House of Commons.

“Today she has broken every single one of those promises. If she had any decency she would resign.”

— Holly Ellyatt

Of course, Chancellor Rachel Reeves didn’t call her new “High Value Council Tax Surcharge” a “mansion tax” but that’s what it’s been dubbed by the media and markets.

Essentially, the “surcharge” amounts to £2,500 for properties worth more than £2 million and £7,500 for properties worth more than £5 million. The OBR said the measures would raise £400 million in tax revenues.

Telling lawmakers that she was taking further steps to “deal with a longstanding source of wealth inequality in our country,” Reeves said:

“Currently, a Band D home in Darlington or Blackpool pays just under £2,400 in Council Tax … nearly £300 more than a £10 million mansion in Mayfair,” she said, referring to one of London’s most prestigious areas.

“And so from 2028, I am introducing the High Value Council Tax Surcharge in England … This will be collected alongside Council Tax, levied on owners,” she said.

This new surcharge will raise over £400 million by 2031 and will be charged on fewer than the top 1% of properties, Reeves added.

— Holly Ellyatt

The FTSE 350 Banks index was last seen trading 1.6% higher, as the budget appeared to avoid new levies on the industry that had been rumored to be under consideration.

Stocks seeing the biggest gains included Lloyds Group, which jumped 4.1%, Barclays, which added 3.6%, and NatWest, which was up by 2.7%.

— Chloe Taylor

U.K. wealth management firms advanced on Wednesday amid a flurry of tax announcements.

St James’s Place moved 4.6% higher, AJ Bell advanced 3.4%, and IG Group gained 8.5%.

— Tasmin Lockwood

Reeves confirmed a £2,000 cap on salary sacrifice pension contributions will be introduced from 2029.

“Reliefs in our tax system cost the taxpayer billions of pounds every year, but many of them no longer serve their original purpose,” she said.

Reeves said tax breaks on salary sacrifice pension schemes are forecast to cost £8 billion by 2030, “with the greatest benefit going to higher earners … while those on the minimum wage or whose employers don’t offer salary sacrifice don’t benefit at all.”

“This is not sustainable for the public finances,” she said. “That is a pragmatic step so that people, especially on low and middle incomes, can continue to use salary sacrifice for their pension without paying any more tax than they do now.”

— Chloe Taylor

Tax increases announced in the budget are expected to raise £700 million next year and £26.1 billion in 2029-30, according to the OBR, which it says will “more than” offset an increase in spending.

Spending policies, including removing the so-called two-child limit for welfare claimants, are expected to increase borrowing by £11 billion in 2029-30, according to the OBR’s forecast.

— Chloe Taylor

The chancellor unveiled plans to widen eligibility for enterprise incentives, including expanding the enterprise management incentive — which offers tax incentives to employees in smaller, high-risk companies — so more companies can offer tax-relieved share options.

The finance minister also said she plans to “re-engineer” enterprise investment and venture capital trust (VCT) schemes — which provide tax relief for investors in early-stage startups. Reeves said she wants those schemes to apply to companies as they grow, too.

There will also be tax breaks for companies that choose to list in the UK. Reeves said new listings will get a three-year exemption from stamp duty reserve tax.

— Kai Nicol-Schwarz

It’s not all tax rises in the budget with the government set to spend more on several welfare measures in the next few years. Reeves is set to announce a bevy of welfare measures, according to the OBR’s unexpectedly released forecast, with a combined cost of £9 billion in 2029-30.

These include the reversals to previously announced cuts to winter fuel payments and health-related benefits, which will cost £7 billion in 2029-30.

The controversial two-child limit within the Universal Credit benefit, which critics have campaigned against, will be removed.

It will cost the country £3 billion by 2029-30, per the OBR, but increases benefits for 560,000 families by an average of £5,310.

— Tasmin Lockwood

British home builder stocks fell 2.6% after the OBR unexpectedly released its forecast ahead of the U.K. budget.

Major UK housing construction companies Persimmon fell almost 4.3%, Taylor Wimpey shed 3.4%, Barratt Redrow dipped 3.9% and The Berkeley Group fell 4%.

“The U.K. Budget offers little relief for homebuilders,” Jack Fletcher-Price, equity analyst at Morningstar, told CNBC via email.

“The OBR’s downgrade to household disposable income and upward revision to inflation point to a tougher macro backdrop, likely weighing on housing demand and sector shares. The absence of any update on abolishing stamp duty on properties under £500k may also disappoint the market,” he said.

“On the proposed mansion tax, if it’s scheduled for 2028, we expect the Conservatives and Reform to pledge its abolition at the next general election – making it unlikely to ever come into effect,” Fletcher-Price added.

Finance Minister Rachel Reeves also confirmed the introduction of a council tax charge on properties valued over £2 million ($6.63 million).

— Tasmin Lockwood

The thresholds at which British voters pay income tax will be frozen until the end of the 2030/31 financial year, according to the Office for Budget Responsibility.

The OBR, which erroneously released Autumn Budget details ahead of the chancellor’s announcement, said that, as a result: “The income tax personal allowance, the higher-rate threshold and additional-rate threshold are frozen at £12,570, £50,270 and £125,140, respectively, until 2030-31,” the OBR said.

Freezing income tax thresholds has been described as a “stealth tax” as it drags more workers into higher tax brackets due to inflation and wage growth.

The freeze income tax thresholds are expected to raise £7.6 billion in 2029-2030, the OBR said.

— Holly Ellyatt

U.K. Chancellor Rachel Reeves has started to deliver her Autumn Budget to lawmakers in the Houses of Parliament. The problem is, we already know what’s in it after the Office for Budget Responsibility published its assessment of Reeves’ latest policies, and its U.K. economic outlook early, in error.

She’s begun her address stating that the OBR’s release was “deeply disappointing” and a “serious error” on their part.

The OBR has just released a statement apologising for the error. It said: “A link to our Economic and fiscal outlook document went live on our website too early this morning. It has been removed. We apologise for this technical error and have initiated an investigation into how this happened.”

It said it would be reporting to its Oversight Board, the Treasury, and the Commons Treasury Committee on how this happened and, “will make sure this does not happen again.”

The OBR said its economic and fiscal outlook and supporting documents would be released (or re-released) when the chancellor has finished her speech.

— Holly Ellyatt

The Office for Budget Responsibility (OBR) has given markets a surprise by publishing its forecasts for the public finances and the economy before Chancellor Rachel Reeves has unveiled her Autumn Budget, which will take place at 12.30 p.m.

The OBR report, which appears to have been published early in error, states that the U.K. economy is forecast to grow by 1.5% on average over the forecast (period), 0.3 percentage points slower than we projected in March, due to lower underlying productivity growth.”

The independent fiscal watchdog was expected to lower growth and productivity growth forecasts. Regarding the latter, the OBR said it had reduced its “central forecast for the underlying rate of productivity growth in the medium term to 1.0 per cent, 0.3 percentage points slower than in our March forecast.”

As for the Autumn Budget, the OBR said tax rises set to be outlined by Reeves would raise £26.1 billion by 2029-2030, the end of this parliamentary term, “through freezing personal tax thresholds and a host of smaller measures.” The budget measures bring the tax take to an all-time high of 38% of GDP in 2030-31.

The amount of fiscal “headroom” or wiggle-room that Reeves has to meet her own fiscal rules on spending and borrowing will rise to £22 billion by the end of the decade, the OBR said, far higher than the £10 billion or so that Reeves envisaged at her last budget.

CNBC has contacted the fiscal watchdog for further comment on the publication. Opposition leader Kemi Badenoch described the early release of the OBR report as a “complete shambles.”

— Holly Ellyatt

U.K. government borrowing costs fell on Wednesday after the country’s Office for Budget Responsibility unexpectedly released its economic and fiscal forecasts ahead of the Autumn Budget.

Yields on the benchmark 10-year gilt were last seen 4 basis points higher at 4.535%, after falling as much 4 basis points following the release.

The OBR was scheduled to publish its forecasts following the budget, which Finance Minister Rachel Reeves will deliver in parliament at 12:30 p.m. London time (7:30 a.m. ET).

Read more on this developing story here: UK government borrowing costs seesaw as official economic forecasts released early

— Chloe Taylor

It’s Nov. 26 and Autumn Budget day is finally here!

It’s been a longer-than-usual wait this year, with budgets usually delivered in late October. We’ve also had so much news flow on what tax rises could be included in Chancellor Rachel Reeves’ budget statement that it’s become hard to keep up.

This “kite flying” of policy proposals — designed to test public and market reaction to an idea before committing to it — has led to criticism of the Treasury, with analysts saying the near-constant drip feed of information (and the scrapping of policy ideas) has confused the public, businesses and markets.

It has also made it harder to gauge what we’re actually going to get when Finance Minister Rachel Reeves finally unveils her spending and taxation plans for the year ahead.

CNBC has taken a close eye on what we might see later today when Reeves unveils the Autumn Budget around 12.30 p.m. London time.

Read more: The UK’s Autumn Budget is coming: Here’s what it could mean for your money

— Holly Ellyatt

Speculation has been rife in recent weeks about the policy mix Reeves could deliver today. A tax raid is widely expected, with several potential sources of revenue hitting headlines in the U.K. recently.

Here’s a roundup:

Income tax thresholds could be frozen, drawing more Brits into higher tax bands as wages rise. Currently, the basic 20% rate of income tax only kicks in on earnings above £12,570 ($16,552). Annual earnings over £50,271 are taxed at 40%, while income above £125,140 a year is taxed at 45%. Anyone earning more than £100,000 has their tax-free allowance reduced at a rate of a £1 deduction from every £2 of income.  

A ‘mansion tax’ is another policy reportedly being considered by the Treasury, which would come as an annual council tax surcharge applied to homes valued at more than £2 million. London’s Evening Standard reported that 600,000 homes in the capital could fall into that threshold.

Private pension contributions and other salary sacrifice schemes — like Cycle to Work benefits — could also be targeted, with reports suggesting Reeves has been considering ending tax breaks for some of those programs.

Salary sacrifice currently allows workers to give up some of their earnings in exchange for a non-cash benefit, meaning it isn’t received as taxable pay and the employee pays less income tax and National Insurance. Rumors suggest Reeves could put a £2,000 limit on how much can be saved into a salary sacrifice scheme before National Insurance — a form of tax on income — applies.

Pension provider Fidelity said that under this system, someone earning £110,000 a year and sacrificing £10,000 into their pension would be liable for an additional NI bill of £160 a year, while their employer would have to pay an extra £1,200 a year.

A Gambling tax has also been floated in the U.K. press as a potential source of income for the government. Winnings from gambling are currently not taxed in Britain, and bets are exempt from VAT. There are already some industry-specific taxes in place, however, including duties of up to 25% on slot machines, a 15% tax on horse or dog races, and a levy of 21% on internet casino bets.  

Pay-per-mile taxes could be applied to electric vehicles, according to The Telegraph. EVs are currently exempt from fuel duty paid by people who drive vehicles fueled by gasoline.

Tourism tax has already been confirmed as a possibility, with Local Government Minister Steve Reed announcing Tuesday that mayors of English cities will be given the power to roll out duties on overnight stays.

Sugar tax will also be another source of additional revenue, with the existing duty on soft drinks with added sugar set to be broadened to include milk-based and milk-alternative beverages from 2028.

— Chloe Taylor

Markets are anticipating an increase in top-tier council tax, dubbed a ‘mansion tax,’ but some have issued warnings that it could slow down the U.K.’s housing market and have knock-on effects on trust in the Labour government.

“Both policies would disproportionally hit London and the South East and we maintain our preference for housebuilders with minimal exposure to these markets, such as Persimmon,” Jack Fletcher-Price, equity analyst at Morningstar, covering U.K. homebuilder stocks, said in a statement.

“The mansion tax has the potential to slow down transactions above the threshold, as logically owners would defer moving in the hope it will be repealed by a later Government,” he added.

The changes to council tax bands is probably overdue, Fletcher-Price said, “but it will further undermine trust in this Government given they promised not to do this in the run up to the election.”

— Tasmin Lockwood

U.K. Finance Minister Rachel Reeves is expected to announce a three-year stamp duty holiday for companies listing on the London Stock Exchange on Wednesday, with the widely-trailed move aimed at reversing the sharp slide in the number of companies publicly listing on the London Stock Exchange.

The measures will send a strong signal that the City of London is open for IPO business, according to Inigo Esteve, a partner at law firm White & Case.

“Stamp duty on share transfers is one of the remaining areas in which London differs from competing listing venues,” said Esteve, a partner in White & Case’s capital markets group.

“By removing this additional tax for investors in newly listed companies, the stamp duty exemption would hopefully help stimulate demand, attract more global capital and support valuations.”

Fundraising from London market debuts tumbled to a thirty-year low earlier this year.  

—Hugh Leask

Bond yields and prices move in opposite directions, so when investors are reluctant to lend to a government, the price of the bond falls and the yield rises.

The U.K. government currently has the highest borrowing costs of any G7 nation, with its 30-year gilt yield trading well above the critical 5% threshold and spending much of this year at multi-decade highs.

Dramatic rises in gilt yields — essentially the amount of interest the government pays on its debt — can also have a wider impact on the overall economy.

While bond yields reflect borrowing costs for the governments who issue them, they can also affect mortgage rates, investment returns, the wider economy and personal borrowing.

Back in 2022, Prime Minister Liz Truss’s swathe of unfunded tax cuts triggered a bond sell-off that had long-lasting effects on the economy and led to her resignation just 44 days into the job.

— Chloe Taylor

CNBC’s Ian King takes a fascinating look at Autumn Budgets past and present in his latest UK Exchange newsletter here: History lessons for Reeves ahead of UK’s much-hyped Budget

Here’s a snippet:

Could Rachel Reeves’ latest budget be the exception? We’ll see.

— Holly Ellyatt

“Rachel Reeves’ reckoning will come from gilt markets,” Nigel Green, chief executive of global financial advisory deVere Group, said in a note this morning.

Yields on U.K. government bonds — known as gilts — are edging higher ahead of the budget, with the yield on the benchmark 10-year gilt last seen 1 basis point higher at 4.509%.

Green noted that the policy unveiling today would not be the only potential source of volatility in British bond markets, with investors keeping a close eye on the Office for Budget Responsibility’s assessment of the economy, which will be released in tandem with the Autumn Budget.

“Today’s Budget speech is only the first act. The real judgement arrives the moment investors see the OBR’s updated revenue profile, growth assumptions and borrowing outlook,” he said. “The gilt market will decide whether the U.K.’s fiscal path is durable or whether the risk premium needs to rise.”

— Chloe Taylor

Investors will be keeping a close eye on the degree to which Chancellor Rachel Reeves will raise the amount of fiscal “headroom,” or wiggle-room, she has to meet her self-imposed “fiscal rules” on spending, borrowing and reducing debt by the end of the decade.

The rules were being met by a small margin when the Office for Budget Responsibility assessed them in March, but events since then mean that this headroom is likely to have disappeared, particularly in light of the OBR’s likely downgrade to productivity and economic growth, as well as U-turns on welfare spending cuts.

Jack Meaning, chief U.K. economist at Barclays, told CNBC that Reeves is likely to target a bigger fiscal headroom of £15-20 billion if she is to avoid having to again look for more money in the near-future.

“Certainly, when we’ve looked at it in the past, with something (fiscal headroom) as small as £10 billion that she had last time, that means there’s a one in three chance she’d have to come back for more tax increases or more spending cuts next time round. So I think probably £15 billion is the minimum the market is looking for,” he told CNBC’s Ian King on Wednesday.

Reeves’ current fiscal headroom of around £10 billion is viewed as istorically very low, “and that’s meant that the market has kept asking questions,” Meaning said.

— Holly Ellyatt

We already know one tactic the government will use to raise more money through taxes: a so-called milkshake tax.

The government confirmed on Tuesday that from Jan. 2028, some milk-based drinks will no longer be exempt from the U.K.’s sugar tax, a levy that’s added onto soft drinks with a high sugar content.

Currently, the tax is charged at 18 pence (24 cents) per liter on drinks with 5 grams of sugar per 100 ml, and 24 pence per liter on drinks with 8 grams of sugar per 100 ml — but it does not apply to milk-based and milk-alternative beverages.

When the changes come into effect, the charge will apply to pre-packaged milk-based or milk-alternative drinks like milkshakes, flavored milks, sweetened yogurt drinks and ready-to-drink coffees. The threshold will also be lowered, so that the tax kicks in once a drink contains 4.5 grams of sugar per 100 ml.

— Chloe Taylor

Markets will be watching the strength of sterling this morning as speculation ahead of the U.K. budget has led to put calls. The price of the currency will act as a real-time gauge on what investors make of the chancellor’s plan for Britain’s economy when she presents her taxation and spending plans later today.

Earlier Wednesday morning, the pound was up 0.18% against the dollar.

“Sterling appears to be in a no-win situation in regards to the budget,” according to Alpine Macro’s Chief Global Fixed Income and Currency Strategist Harvinder Kalirai.

“If Chancellor Reeves tightens fiscal policy, it will open the door for more easing by the (Bank of England). Tight fiscal/easy monetary policy is a classic mix for a weaker currency,” he said. “If Reeves treads cautiously, then concerns over U.K. deficits and a rising debt burden should weigh on sterling.”

Leveraged investors have GBP shorts tied to the event, according to Daniel Tobon, head of G10 FX strategy at Citi. “Notably, despite worsening news on the budget and weaker U.K. data, GBP has failed to sell-off in recent weeks. This suggests a saturated short GBP position with the bad news likely priced in,” he said.

Citi had been targeting 0.88 for EURGBP into the budget, “and that target has been met but EURGBP has also failed to push higher despite numerous attempts,” Tobon told CNBC in emailed comments.

“Absent a negative shock in the budget, we see a greater risk of a ‘position squeeze’ (unwind of short GBP positions) and suspect some investors are already starting to unwind these short GBP trades as gilts fail to sell-off further.”

— Tasmin Lockwood

What Sanjay Raja, chief U.K. economist at Deutsche Bank, had to say ahead of the budget:

— Holly Ellyatt

Ahead of the chancellor’s critical statement — which could herald tax rises, spending cuts, or a combination of the two — fund managers are lining up high-conviction trades on U.K. housing, the British currency and beaten-down cyclical equities.

Take a closer look here: Three ways for investors to trade the budget

— Hugh Leask

“The budget effectively seems to be being driven by keeping the Labour party factions together and ensuring they can get whatever they do announce through parliament,” former Conservative U.K. Treasury Minister and Goldman Sachs Chief Economist Jim O’Neill told CNBC on Tuesday. 

Reeves’s past attempts to slash the U.K.’s welfare bill were watered down following a rebellion among some of the Labour party’s own lawmakers.

“I don’t have high expectations for it being an ‘oh wow, this is really getting to grips with things’ budget, but it will definitely be done to keep the fiscal rules on balance, at least for now,” O’Neill added.

— Chloe Taylor