Month: November 2025

The horse-racing industry is bracing for a £10 million rise in costs after being excluded from new business rate reliefs due to come into force next April — a move that coincides with fears of a fresh tax raid on betting in the upcoming Budget.
According to research by Colliers, racing yards are among several categories that will lose access to the current 40 per cent rates relief, facing average increases of more than £7,000 per yard — equivalent to a 40 per cent rise in total business rate bills across the sector.
The property consultancy estimates that around 300 training yards, covering about 90 per cent of the sector, currently benefit from the relief but will now be left out of the new system, which will apply only to venues “wholly or mainly” used for retail, hospitality, or leisure activities provided to the public.
The National Trainers Federation and the British Horseracing Authority (BHA) have begun working together to alert members to the changes and lobby for clarity ahead of the November 26 Budget.
The Treasury’s overhaul is part of its wider plan to make the business rates system “fairer and fit for the 21st century”, with permanent lower multipliers for smaller retail, hospitality and leisure premises with rateable values under £500,000.
However, this lower rate will be funded by a higher multiplier for all other commercial properties — including racing yards, laboratories, and large-scale facilities — when the new system takes effect from April 2026.
John Webber, head of business rates at Colliers, warned that many trainers could struggle to absorb the extra burden: “Trainers work on small margins and employ many people on low wages. The rise in employer National Insurance contributions and the national minimum wage has already hit them hard. To add increased business rates on top could push some over the edge.”
He added that while the Treasury’s relief plan was designed to support the high street, its exclusion of the horse-racing and betting industries risked “further damage to struggling local economies.”
The reform will also affect more than 6,000 betting shops, which Colliers estimates could collectively pay an additional £10 million a year in business rates compared to similar-sized retail outlets that qualify for relief.
The betting sector is already under pressure amid speculation that Chancellor Rachel Reeves will raise gambling duties in the Budget later this month — a move that industry bodies have warned could lead to widespread betting shop closures.
“Taxing the betting industry will not help the high street — it will only lead to more empty shops,” Webber said. “And the knock-on effects are significant: less money for bookmakers means less money flowing back into British horseracing.”
A Treasury spokesperson said the new system would make rates fairer overall, introducing lower rates for most retail, hospitality and leisure businesses while applying a higher charge to less than 1 per cent of high-value commercial properties.
“We’re making business rates fairer by introducing permanently lower rates for retail, hospitality and leisure from April, funded by a higher rate on the most valuable business properties,” the spokesperson said.
They added that the government remained committed to supporting the UK’s business environment: “We’ve capped corporation tax at 25 per cent — the lowest in the G7 — secured major trade deals with the US, EU and India, and seen interest rates cut five times since the election to help businesses across Britain.”
Treasury sources also stressed that the department “understands horseracing is part of the cultural fabric of the country” and has no plans to change the tax treatment of racecourse betting, which remains exempt from duty.
The horse-racing sector — which supports more than 85,000 jobs and contributes around £4.1 billion annually to the UK economy — now faces dual headwinds from both the rates overhaul and a potential betting levy increase.
Industry leaders warn that without targeted support, smaller yards and rural racing operations could face closures, dealing a further blow to Britain’s standing as a global centre of equine sport.
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Horse-racing industry faces £10m blow from business rates overhaul

Let’s get one thing straight: I’m not usually in the business of tutting at shoes. I’m not the keeper of the brogue, nor the patron saint of patent leather.
But when a man hosts a dinner at his own three-Michelin-starred restaurant to celebrate the newly knighted Sir David Beckham, and turns up in a tuxedo paired with gleaming white trainers — well, I start to wonder if the world hasn’t finally gone mad.
Now, of course, Gordon Ramsay owns the place. If anyone can decide the dress code at a table of his own, it’s the chef-proprietor himself. He can serve pigeon in a paddling pool and wear pyjamas if he likes. But ownership doesn’t equal immunity from taste. There’s a line between “relaxed contemporary cool” and “I’ve given up”. And I’m afraid, Gordon, that night you were teetering perilously close to the latter — in trainers, no less.
What made the spectacle even starker was the company. This wasn’t a boozy mates-only dinner down the King’s Road. It was a black-tie celebration for Beckham’s knighthood — the culmination of a decades-long campaign of service, brand management and quiet self-reinvention. And Sir David, to his eternal credit, turned up looking like a walking Bond franchise: the tux razor-sharp, the shoes mirror-bright, posture immaculate. Even, the now Lady Victoria, never knowingly underdressed, embodied old-school grace. Around the table, guests glimmered in black and silk, the dining room itself a temple of fine formality. Then there was Gordon,  beaming proudly, I’m sure for pone of his closest friends, but looking as if he’d dashed straight from the pass to the party without time to lace up.
Let’s not kid ourselves: trainers with a tux aren’t a bold fashion statement anymore. They’re the lazy man’s rebellion, the sartorial equivalent of mumbling at a job interview. Once upon a time, it was rock stars and artists who broke the rules; now it’s millionaires pretending to be effortless. And in the hallowed dining room of Restaurant Gordon Ramsay, where the sauces are reduced to the millisecond and the tablecloths are ironed flatter than the M25, that nonchalance rings hollow.
There’s an old idea that what you wear to dinner says something about how seriously you take the company you’re in. Dress up for the people you respect. Make an effort for the moment. And when that moment is the knighthood of one of Britain’s most famous men, perhaps a pair of Oxfords wouldn’t kill you. Beckham understood that instinctively. Ramsay, alas, looked like he’d mistaken “three-star” for “street-food pop-up”.
I’m not saying we should all resurrect the tailcoat. God knows no one needs more starch in their life. But some occasions, and this was one, still deserve their sense of ceremony. A knighthood isn’t just a social media milestone. It’s the country tipping its hat to a lifetime of excellence, captaining of England, his involvement in the 2012 London Olympics and numerous charities including His Majesty’s Kings Trust (formerly the Princes Trust). The dinner that follows should match that spirit of reverence. If the chef-host can’t be bothered to put on proper shoes, why should anyone else bother to polish their manners?
Of course, Ramsay might argue that he’s a man of modern tastes, that the Michelin world needs loosening up, that formality is for dinosaurs. Maybe. But there’s a world of difference between evolution and erosion. When everything becomes casual, nothing feels special. And part of the allure of fine dining — and indeed of honours, titles, rituals — is that they are special. That they demand something extra of us. A little theatre. A little respect. A little polish.
The irony is that Ramsay, of all people, understands precision. His entire empire is built on it — on the poise of a sauce, the placement of a garnish, the glint of a knife. He’ll bark at a chef for an overcooked scallop, but when it comes to footwear, apparently anything goes. Perhaps he thought the trainers were a cheeky modern touch, a wink to contemporary cool. But against the tableau of gleaming glassware, bow-tied guests and Beckham’s effortless suavity, it just looked … off. Like ketchup on foie gras.
Then again, maybe that’s the point. Maybe Ramsay wanted to telegraph that fine dining is evolving — that even at its summit, the rules are ready to bend. But there’s a danger in bending them too far. Because when even the guardians of refinement decide that effort is optional, the very idea of “special” starts to crumble. And if there’s anywhere that should still demand a bit of theatre,  a bit of occasion,  it’s the dining room of a three-star restaurant celebrating a newly minted knight of the realm.
In the end, this isn’t really about shoes. It’s about symbolism. The Michelin stars, the knighthood, the restaurant, the clothes, all of it speaks a shared language of aspiration. And in that language, trainers say something else entirely. They say: I don’t care that much. And perhaps that’s fine if you’re catching a flight or popping to Waitrose. But when you’re toasting Sir David Beckham under chandeliers, it feels just a bit … cheap.
So, Gordon — you own the restaurant, the name, and the night. But sometimes ownership carries responsibility. And on this occasion, when everyone else rose to meet the grandeur of the moment, your shoes let the side down. The food was I am sure was flawless, the wine divine, the conversation sparkling. But those trainers? They were the only thing in the room that didn’t quite fit.
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Sorry Gordon, whilst you own the restaurant, but trainers with a tux? really?

Rachel Reeves is considering a pay-per-mile tax on electric vehicles (EVs) as part of her forthcoming Budget, in a move that could raise hundreds of millions of pounds a year and help offset the sharp decline in fuel duty revenues caused by Britain’s shift to greener transport.
The proposed levy, expected to feature in the 26 November Budget, would see EV drivers charged around 3p per mile, adding an average of £250 a year to running costs. The new duty would sit alongside existing road taxes, which electric vehicle owners became liable for from April this year.
A government spokesperson said the move was designed to make motoring taxation “fairer for all drivers”, noting that petrol and diesel motorists currently pay around £600 annually in fuel duty while EV owners pay none. “Fuel duty covers petrol and diesel, but there’s no equivalent for electric vehicles. We want a fairer system for all drivers,” the spokesperson said.
The proposed pay-per-mile charge is being considered as part of the Chancellor’s efforts to fill a £20–30 billion fiscal gap over the remainder of the Parliament. According to the Daily Telegraph, which first reported the plan, the system would be introduced in 2028, following a public consultation.
By then, around four million Britons are expected to drive electric cars or vans, according to the Society of Motor Manufacturers and Traders (SMMT). The trade body, however, warned that the measure could undermine the UK’s fragile EV transition.
“We recognise the need for a new approach to motoring taxes,” the SMMT said, “but at such a pivotal moment in the UK’s EV transition, this would be entirely the wrong measure at the wrong time.”
Jon Lawes, managing director at Novuna Vehicle Solutions, said that while a fairer tax system was inevitable, affordability and infrastructure should take priority. “The cost of EVs and charging availability remain major barriers,” he said, urging the government to accelerate charger deployment, extend grants, and boost incentives for used EVs.
The government has already invested £4 billion to support the transition to electric vehicles, including grants worth up to £3,750 per vehicle. But the Chancellor faces growing pressure to broaden the tax base as fuel duty receipts decline, with analysts estimating the Treasury could lose more than £25 billion annually by the early 2030s as the combustion fleet shrinks.
Policy analysts say the pay-per-mile scheme would mark a significant shift in transport taxation, replacing fuel-based levies with usage-based charges. The Campaign for Better Transport and the Tony Blair Institute have both called for road pricing in recent years, suggesting a 1p-per-mile charge for cars and vans and up to 4p for heavy goods vehicles.
Even with a 3p charge, analysis by the Energy and Climate Intelligence Unit suggests that EVs would remain around £1,000 cheaper per year to run than petrol vehicles.
“This announcement comes shortly after the government weakened its EV sales targets under industry pressure,” said Colin Walker, the unit’s head of transport. “That could allow more hybrids on the road that burn five times more fuel than advertised, costing drivers hundreds more a year.”
Treasury insiders have framed the proposal as a matter of fairness rather than revenue-raising, but its timing — as Labour prepares a tax-heavy second Budget — underscores the government’s growing dilemma: how to fund Britain’s transition to net zero without stalling public adoption of clean technologies.
As Reeves finalises her Budget, the EV tax debate will test Labour’s ability to balance fiscal discipline, industrial policy, and environmental ambition — a triad that could define the economic tone of the new government.
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Rachel Reeves considers pay-per-mile tax on electric vehicles to plug £30bn fiscal gap

The government is still reviewing plans to tighten reporting requirements for small and micro companies, with ministers yet to decide whether to press ahead with rules that would require them to publish profit-and-loss accounts for the first time.
In an interview with The Times, Blair McDougall, the new small business minister, said that “all options are on the table” as officials weigh up the balance between tackling fraud and protecting small firms from unnecessary administrative burdens.
“There are obviously different arguments in terms of the impact on businesses of their exposure, particularly for SMEs, versus people who are worried about financial crime and everything else,” McDougall said. “We’re balancing that at the moment and discussing it.”
Under plans announced by Companies House in June, firms classified as “small” or “micro” would lose the right to file abbreviated accounts from April 2027. Instead, they would have to submit full profit-and-loss statements, revealing revenues and profits.
The move formed part of the Economic Crime and Corporate Transparency Act, designed to reduce fraud and improve the accuracy of information filed at Companies House. However, within days of the announcement, the Department for Business and Trade signalled a pause in the rollout amid concerns from business groups that the new rules would increase red tape and risk exposing commercially sensitive data.
If implemented, the reforms would affect companies with turnover below £10.2 million, balance sheets under £5.1 million, and fewer than 50 employees. They would also require all firms to file accounts digitally using commercial software, ending the use of paper and web-based submissions.
The proposals were first consulted on in 2019 and made law in 2023 under the previous Conservative government. Business groups have broadly supported greater transparency but warned that the changes could deter entrepreneurship by exposing small firms’ financial details to competitors.
McDougall, who became an MP in 2024 and took on his first ministerial role in September, said the government’s focus was on building business confidence and long-term growth rather than rushing through reforms.
He added that success would be judged by how well the government delivers on its Small Business Plan and industrial strategy, both launched earlier this year. “We’ve got a terrible history in government of publishing these PDFs that then gather dust,” he said.
McDougall spoke during International Trade Week at The Great British Pitch, an event organised by Small Business Britain that brought together entrepreneurs and international buyers. He said such initiatives were central to boosting the profile of British SMEs and driving export-led growth.
The final decision on the Companies House reforms is expected early next year, with officials indicating that ministers are still assessing the regulatory impact on smaller businesses before confirming the 2027 timetable.
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Government still weighing changes to small company filing rules, says business minister

The government has clawed back £74 million from private firms accused of making “excessive profits” under multi-billion-pound asylum accommodation contracts — a figure that amounts to a tiny fraction of the £2.1 billion annual cost to taxpayers.
The Home Office confirmed it had recovered the funds following a review into contracts covering more than 200 hotels housing around 32,000 asylum seekers across the UK. The investigation found several suppliers had breached profit thresholds agreed under their long-term deals to provide accommodation for migrants.
However, the sum recovered is just 3.5% of the department’s total asylum accommodation spend for 2024/25, which averages £5.77 million per day, fuelling renewed criticism from MPs who accuse ministers of losing control of costs and contracts.
In a damning assessment, the Commons Home Affairs Select Committee said the Home Office had “squandered billions” on migrant hotels and presided over a “failed, chaotic and expensive” system. The report said there had been a “manifest failure” to manage contracts with private companies, allowing them to make excessive profits from the Channel crisis.
The committee’s Conservative chair, Dame Karen Bradley, welcomed the recovery of £74 million but described it as “only a first step”.
“This is only a small part of the many billions that the contracts have and will cost,” she said. “The government must now set out its long-term plan for delivering a resilient and cost-effective asylum accommodation system.”
MPs also criticised the Home Office for failing to require providers to assess the impact on local communities before opening hotels, saying the decision had placed unsustainable pressure on local services and damaged public trust.
The Home Office is currently supporting 103,000 migrants at the taxpayer’s expense, including those in hotels, dispersal accommodation and private flats. Average hotel accommodation costs £144.98 per person per night, compared with just £23.25 for dispersal housing.
While costs have fallen from £3 billion in 2023/24 to £2.1 billion this year — partly through the use of cheaper accommodation and room-sharing — MPs say billions have already been lost to poor oversight.
Home Secretary Shabana Mahmood said the government had inherited “asylum hotel contracts that were not delivering good value for taxpayers’ money” but stressed that reforms were under way.
“We have already saved £700 million in hotel costs. Now we are recouping millions more in excess profits. And by the end of this Parliament, we will have closed every asylum hotel,” she said.
The 10-year contracts, signed in 2019 with three private providers, were designed to give the government long-term capacity to manage asylum accommodation across the UK. But after years of spiralling demand and emergency hotel use, ministers are now facing renewed pressure to overhaul the system — with MPs warning that, without deeper reform, taxpayers will continue footing an “unsustainable” bill.
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Government recoups £74m from asylum accommodation firms amid criticism over ‘chaotic’ hotel contracts

The National Enterprise Network (NEN) has urged Chancellor Rachel Reeves to use this month’s Autumn Statement to deliver a new wave of support for Britain’s micro and small businesses (MSBs) — which it says are “the foundation of the UK economy” but increasingly constrained by rising costs and patchy access to finance.
Representing a nationwide network of local enterprise agencies and business support organisations that together cover 98% of the UK, the NEN is pressing the Treasury to take “decisive action” across four key policy areas: growth and investment, access to finance, skills and support infrastructure, and the net zero transition.
The submission comes as 5.45 million UK firms — accounting for over 99% of all private sector businesses — face mounting pressures from inflation, short-term funding cycles and the cost of digital and environmental adaptation.
“Micro and small businesses are the engine of the UK economy,” said Alex Till, Chair of the National Enterprise Network. “But their success depends on the ecosystem that supports them — the enterprise agencies, business hubs, and community workspaces that help individuals take their first steps into entrepreneurship. Without urgent action, we risk losing a generation of early-stage entrepreneurs.”
Four key policy priorities
Enabling small businesses to grow and thrive
NEN is calling for a Small Business Growth Allowance to encourage firms to reinvest profits in digital adoption, upskilling and capital investment, alongside expanded Local Enterprise Grants for rural and underserved areas.
It also proposes a Business Resilience Fund to help firms manage energy and climate-related pressures, and a simplification of access to existing government loans, grants and training schemes. The network is urging the Treasury to extend Business Rates Relief for the smallest firms in high-cost areas.
A particular focus is on the future of shared and managed workspaces, which NEN describes as “the first rung of the enterprise ladder”. Many of these community hubs — often run by not-for-profit organisations — are under threat from rising business rates and operational costs.
The group wants the Government to review the business rates treatment of co-working and managed spaces and to introduce dedicated relief for community and not-for-profit workspace operators.
Improving access to finance
The NEN is pressing for reforms to the Enterprise Finance Guarantee (EFG) to make smaller loans (under £50,000) more accessible, and the introduction of a Micro-Investor Tax Relief Scheme to encourage local private investment.
It also calls for greater awareness of Community Development Finance Institutions (CDFIs) and the creation of a Digital Finance Support Programme to help small firms modernise payments, invoicing, and cashflow systems.
Strengthening skills and support networks
The submission recommends funding Enterprise Skills Bootcamps — five-week intensive training programmes delivered through NEN member agencies — and expanding access to modular apprenticeships and digital skills vouchers in areas such as e-commerce, AI and online marketing.
To ensure long-term stability, the network wants a Support Infrastructure Stability Fund providing multi-year contracts for local enterprise agencies and business hubs, and a Capacity-Building Grant Fund to help them upgrade digital systems and impact measurement tools.
Accelerating the net zero transition
NEN’s final proposals focus on helping small firms manage the costs of decarbonisation. It calls for a Small Business Energy Transition Fund and temporary energy cost relief for microbusinesses in energy-intensive sectors.
It also wants targeted funding for local enterprise agencies to deliver Net Zero Readiness Advisory Services, helping firms comply with environmental standards while remaining competitive.
“Without action — particularly around business rates reform for shared workspaces and sustainable funding for enterprise support infrastructure — the UK risks losing the networks that sustain entrepreneurship at a local level,” Till added.
Central to the NEN’s message is the need for government to support the supporters — the local enterprise agencies and community business hubs that provide front-line help to Britain’s entrepreneurs.
By adopting its recommendations, the organisation says the Treasury can strengthen both the small business base and the infrastructure that underpins it, helping to secure a “more inclusive, innovative and resilient economic future” for the UK.
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National Enterprise Network urges Chancellor to back small business growth in Autumn Statement

The Bank of England has voted narrowly to hold interest rates at 4%, pausing further cuts amid stubborn inflation and growing uncertainty ahead of Chancellor Rachel Reeves’ pivotal Budget later this month.
In a closely split decision, the Monetary Policy Committee (MPC) voted 5–4 to maintain the current rate, with Governor Andrew Bailey casting the deciding vote. Bailey said he would “prefer to wait” before supporting any further loosening of monetary policy, citing ongoing concerns about inflation expectations among households and elevated wage growth.
The Bank expects inflation to remain above its 2% target until the second quarter of 2027, forecasting a gradual decline from its current 3.8% level. Officials said consumer price inflation had “peaked” but warned that persistent price pressures — particularly in services and food — continued to pose risks.
In its latest economic outlook, the Bank maintained its growth forecast of 1.4% for both 2025 and 2026, revising up the current year slightly but lowering next year’s estimate amid weakening demand and a slowing labour market.
Some members of the MPC highlighted evidence of a cooling jobs market and falling vacancies, which could reduce inflationary pressures. Others, however, warned that wage growth of 4.9% in the three months to August was still too high to justify immediate cuts.
Bailey said that while inflation risks were “less pressing” than in August, the case for easing policy had not yet been proven.
“Upside risks to inflation have become less pressing since August, and I see further policy easing if disinflation becomes more clearly established in the period ahead,” he said. “Rather than cutting Bank Rate now, I would prefer to wait and see if the durability in disinflation is confirmed in upcoming economic developments this year.”
The Bank’s statement dropped the word “careful” from its policy guidance, describing instead a “gradual path downwards” for rates — a subtle but significant signal that a series of cuts could follow in 2026 if inflation continues to ease.
The decision comes as markets await Reeves’ 26 November Budget, expected to include new tax rises to fund public spending and reduce borrowing. The Chancellor has hinted that “all must contribute” to restoring fiscal health — a departure from earlier pledges that only those with “the broadest shoulders” would face higher taxes.
Economists say any income tax increases announced later this month could be disinflationary, reducing consumer spending power and potentially allowing the Bank to cut rates sooner in 2026. However, uncertainty over fiscal policy — and the size of a reported £30 billion funding gap — is prompting the MPC to keep its options open.
The Bank also noted that last year’s £25 billion increase in employers’ national insurance contributions (NICs) had fed through to higher supermarket prices, with food inflation expected to reach 5.3% by year-end. Officials said the impact of those changes was now largely absorbed by consumers.
Economists were divided on the Bank’s decision. William Ellis, senior economist at the IPPR, said the MPC had missed an opportunity to support growth.
“Monetary policy remains tight, and the Bank should have gone further today by cutting rates to support the economy,” he said. “With inflation flat, sluggish growth, and a cooling labour market, the case for easing is clear.”
Daniel Austin, CEO and co-founder of ASK Partners, said the decision reflected a cautious stance amid global volatility and fiscal uncertainty.
“With the Autumn Statement approaching and policy in flux, it’s little surprise the MPC has held rates at 4%,” he said. “High fixed-rate mortgages mean meaningful relief for homeowners remains distant. In property, the decision reinforces a ‘wait and see’ mood — with buyers pausing and developers holding back.”
Austin added that while easing planning rules and offering temporary levy relief could help restart stalled housing projects, “a clear, sustained fall in inflation remains key to unlocking broader investment”.
Despite signs of progress on inflation, the Bank’s latest move underscores a fragile recovery. A combination of high borrowing costs, weak productivity growth, and looming fiscal tightening has kept confidence muted across households and businesses alike.
With both the Bank of England and the Treasury facing competing pressures — to tame inflation without choking growth — the next few months could prove decisive in shaping Britain’s economic trajectory into 2026.
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Bank of England holds interest rates at 4% as Rachel Reeves’ Budget looms

Chancellor Rachel Reeves has signalled that her 26 November Budget will ask more Britons to shoulder the burden of repairing the nation’s public finances — even if that means breaking Labour’s manifesto pledge not to raise income tax.
In a speech this week, Reeves warned that “hard choices” were unavoidable if Britain was to protect the NHS, reduce national debt and keep inflation under control. Her language marked a shift from earlier assurances that only those with the “broadest shoulders” would face higher taxes.
“If we are to build the future of Britain together, we will all have to contribute,” she said. “When that requires hard choices, we will act guided by the interests of working people.”
While the Chancellor maintained that fairness would underpin her fiscal plans, her remarks were widely interpreted in Westminster as preparing voters for a broader tax rise that could affect millions of middle-income workers.
At the heart of the political tension lies the question of how Labour defines “working people” — a term that may exclude much of the upper-middle-income bracket. Treasury insiders suggest the government considers those earning up to £45,000–£46,000 a year as “working people”.
That would leave roughly one-third of UK earners outside the protected group, potentially exposing professionals such as paramedics, teachers, software developers, and vets to higher income tax or national insurance contributions.
Data from the Office for National Statistics (ONS) shows that around 40% of male employees and 20% of female employees earn above £45,000. In London, where the median full-time salary stands at nearly £50,000, the proportion is significantly higher — meaning the capital’s workforce could face the steepest hit.
Ironically, Labour’s own inflation-busting public sector pay awards could see the Chancellor give with one hand and take with the other. NHS pay scales show that senior paramedics, speech and language therapists, and school nurses now earn above the proposed threshold.
Similarly, the National Education Union estimates that nearly all school leaders and senior teachers fall within the bracket likely to face higher tax. Years of frozen income tax thresholds — known as fiscal drag — have already pushed many of these workers into higher bands.
Britain’s finances have become increasingly reliant on a small pool of top-rate taxpayers. According to HMRC projections, 1.2 million people earning above £125,140 — just 3% of all income-tax payers — contribute around 40% of total income tax receipts.
Income tax now raises more than £300 billion annually, making it the government’s single largest revenue stream. Yet, as tax policy experts point out, Britain’s average worker still pays less tax on earnings than counterparts in most major European economies.
“The UK system has become top-heavy,” said Chris Sanger, head of tax policy at EY. “If you increase rates for those with the highest incomes, you risk losing mobility and, ultimately, revenue. In a post-pandemic world where remote work is common, the wealthy can relocate more easily than ever.”
The political risk for Labour is that a tax rise on higher earners could alienate the very middle-class voters who helped deliver its 2024 election victory. YouGov polling shows that households earning over £50,000 were disproportionately likely to vote Labour, while Reform’s support was strongest among lower-income groups and Conservative voters skewed older and retired.
If Reeves presses ahead, she faces a delicate balancing act: funding the public services Labour has promised to revive, while avoiding a backlash from the professionals and entrepreneurs who underpin Britain’s tax base.
As one City economist put it: “Reeves is walking a fiscal tightrope — between fairness and flight risk. The more she taxes those who can move, the less they’ll stay to pay.”
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Labour risks breaking tax pledge as Rachel Reeves targets higher earners in autumn Budget

Sir Charlie Mayfield says ill-health is driving millions out of work, costing employers and the economy billions — but the problem is “not inevitable.”
Britain is at risk of an “economic inactivity crisis” as the number of sick and disabled people out of work continues to rise, according to a government-commissioned review led by Sir Charlie Mayfield, the former John Lewis chairman.
The report warns that 800,000 more people are now out of work due to health conditions than in 2019, costing employers £85 billion a year in lost productivity, sick pay and staff turnover. Without intervention, a further 600,000 workers could leave the labour market by 2030.
“This is not inevitable,” Sir Charlie said, as he launched a new taskforce aimed at helping people return to work and tackling what he described as a “vicious cycle” of poor health and economic inactivity.
The report, commissioned by the Department for Work and Pensions (DWP) but produced independently, found that one in five working-age people is now out of work and not seeking employment — a major reversal after decades of improving participation.
Sir Charlie said sickness is costing the UK far more than just business losses.
“Work is generally good for health, and health is good for work,” he said. “For employers, sickness and staff turnover bring disruption and lost experience. For the country, it means weaker growth, higher welfare spending and greater pressure on the NHS.”
According to some estimates, illness-related inactivity costs the wider economy £212 billion a year — almost 70% of annual income tax receipts — through lost output, welfare payments and additional healthcare costs.
The Office for Budget Responsibility (OBR) expects spending on health and disability benefits for working-age people alone to reach £72.3 billion by 2029–30.
Mayfield said the surge was being fuelled by a “sharp rise” in mental health conditions among younger workers and chronic musculoskeletal problems — such as back pain and joint issues — among older staff.
His taskforce will also work with GPs, who he said often face pressure from patients to issue sick notes but find it difficult to assess whether someone could work in a modified role.
Business groups broadly welcomed the taskforce but warned that parts of Labour’s Employment Rights Bill risk discouraging firms from hiring people with existing health conditions.
The Bill includes guaranteed hours and restrictions on zero-hours contracts — measures that some retailers fear will make flexible hiring harder.
Helen Dickinson, chief executive of the British Retail Consortium, said retailers were committed to supporting employees with ill-health but that “the government’s goals and policies are at odds with one another.”
“While encouraging employers to invest in workforce health and provide flexibility, they risk making it more difficult,” she said.
In response to the report, the government announced a partnership with over 60 major employers, including Tesco, Google UK, Nando’s and John Lewis, to test new health and wellbeing initiatives aimed at reducing sickness absence and improving return-to-work rates.
Over the next three years, these programmes will form the basis for a voluntary national workplace health standard, expected by 2029.
Work and Pensions Secretary Pat McFadden said the partnership was “a win-win for employees and employers.”
“This is about keeping good, experienced staff in work and supporting people to stay healthy for longer,” he said.
Ruth Curtice, chief executive of the Resolution Foundation, said the review “accurately identified a culture of fear, a dearth of support and structural barriers to work” as key issues behind Britain’s worsening inactivity rate.
The CIPD, representing HR professionals, welcomed the focus on prevention. Its chief executive, Peter Cheese, said the report’s success “will depend on how well its recommendations are understood by business and backed by national and regional policymakers.”
Dr Roman Raczka, president of the British Psychological Society, said the shift toward “rehumanising the workplace” was overdue, but warned that not everyone could or should return to work.
“The workplace itself can be a root cause of poor mental health,” he said. “Those signed off sick deserve timely access to safe, compassionate care.”
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Ex-John Lewis boss warns UK faces £85bn sickness bill and economic crisis