Budget

Spring Statement 2025

Chancellor Rachel Reeves pledged to "secure Britain’s future," attributing economic challenges to global instability. Her Spring Statement outlined spending cuts, economic reforms, and a focus on long-term growth without introducing new tax rises beyond those previously announced.

AIA Resources

Key announcements will be published on this page and budget coverage will be in the forthcoming issue of International Accountant magazine. AIA Members in Practice also have full access Tolley Tax Library and Online Seminars where all the announcements will be reflected.

Tax Card 2023/24

Updated Tax Card coming soon.

Announcements from the UK Spring Statement 2025

Here's a quick guide to the main announcements:

Economic Outlook

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The Office for Budget Responsibility (OBR) halved its 2025 growth forecast from 2% to 1%, presenting a challenge to the government’s economic ambitions.
Planned investments, including Heathrow expansion, pension reforms, and planning system changes, would drive future growth.
Despite earlier projections of a £4.1bn deficit by 2029/30, the Chancellor stated that new measures would bring the budget back to a £9.9bn surplus.
Inflation fell to 2.8% in February, though analysts warn of upcoming price increases.

Welfare & Public Spending

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A £5bn reduction in welfare spending will reshape disability and sickness benefits.
The health element of Universal Credit will be cut by 50% for new claimants, though the standard allowance will rise from £92 to £106 per week by 2029/30.
A 15% reduction in Whitehall operating costs, saving £2bn by the end of the decade.
A £3.25bn transformation fund will support AI advancements, civil service redundancies, and new digital systems.

Defence & Taxation

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Defence spending will rise, with an initial £2.2bn investment next year and a commitment to allocate 10% of the budget to emerging technologies, such as AI and drones.
Tax measures will focus on tackling evasion, aiming to recover £7.5bn by 2030.
Previously announced tax increases, including a National Insurance rise and frozen income tax thresholds, will take effect next month.

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