This year’s Autumn Budget changes arrive with a mix of new taxes, frozen thresholds and a few industry-specific revisions that will take some getting used to. Rather than a single major policy shock, the government has opted for several gradual shifts aimed at raising more revenue without altering headline Income Tax rates. The end result is a set of rules that every business, driver and operator will need to track quite closely.
A clearer look at the Autumn Budget changes
Across the board, the direction is steady but firm. Business rates relief for hospitality, retail and leisure shrinks from 40 percent to a slimmer permanent reduction. Wage bills rise again in April 2026 when the National Living Wage increases to £12.71 an hour for over-21s, while 18 to 20 year olds move to £10.85.
Rental income tax rises by two percentage points from 2027. Electric vehicles gain a new 3p-per-mile tax from 2028. Fuel duty stays frozen at its reduced level for now, then climbs back up from late 2026. An analyst captured the tone well, noting that by avoiding a direct rise in Income Tax, the Chancellor had instead created “more complexity in the tax system”.
How the Autumn Budget changes affect commercial and small business clients
For many small firms, business rates will be the first real adjustment they notice. The discount falls significantly, though the stability of a permanent scheme offers some small comfort. Corporation Tax remains at 25 percent, but employers face a future cost from 2029 when National Insurance begins applying to salary-sacrifice pension contributions above £2,000 a year.
One of the bigger operational shifts is the new e-invoicing mandate. From 2029, VAT-registered businesses must send and receive VAT invoices through digital system-to-system transmission. Landlords and firms trading exclusively with consumers are exempt for now, but the wider commercial sector will need time to plan software upgrades and integrations.
Import rules also tighten. Goods under £135 lose their customs duty relief by March 2029, following a rise in low-value imports. Retailers competing with rapid overseas sellers may find the rule change levels the field a little.
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Taxi and private hire: VAT rules changing in 2026
Perhaps the most significant sector-specific adjustment sits within private hire and taxi operations. From 2 January 2026, operators can no longer rely on the margin-based VAT calculations provided by the Tour Operators’ Margin Scheme. The consultation triggered by the Uber VAT cases has ended, and the government is legislating to require VAT on the full fare unless the service is part of a qualifying travel package.
Commentary from advisers suggested this removes around £7 billion of relief from the sector. It also narrows the competitive gap between app-based platforms and traditional operators. The timing is interesting. Implementation happens just after the festive season, traditionally one of the busiest periods for private hire. Operators will want to use the remaining time to review pricing models, compliance systems and accounting processes before the new rules begin.
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Motor trade and automotive: EV miles, fuel duty and training
Many motor dealers and fleet managers will be awaiting the implementation of the new approach to EV taxation nervously. From 2028, fully electric vehicles and plug-in hybrids fall under a 3p-per-mile charge. Plug-in hybrid drivers will continue paying fuel duty on petrol as well as the new levy. Dealers have called the scheme a bureaucratic challenge, not least because it may leave some drivers confused about their long-term running costs.
Fuel duty stays cut until September 2026. After that it climbs back over six months. For commercial fleets, this temporary extension helps in the short term but still needs factoring into mid-term cost planning.
SMEs do gain one positive measure. Apprenticeship training for under-25s becomes free for smaller employers. Workshops and garages that rely on apprenticeships to develop skilled technicians may find this reduces pressure in a sector where recruitment is already tough.
Summary
The Autumn Budget changes bring a steady mix of new measures and amended rates rather than a major overhaul. Business rates tighten, wage costs rise again in 2026 and digital compliance moves a step closer with mandatory e-invoicing on the horizon. Private hire operators face the biggest shift with full-fare VAT rules arriving in early 2026, while the motor trade prepares for EV mile charges and the return of higher fuel duty. Each measure lands at a different time, so the real task for businesses is keeping an eye on the timelines and planning gradually rather than reacting late.
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