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Spring Statement 2025

On 26 March 2025, Chancellor Rachel Reeves delivered the Spring Statement, accompanied by a forecast from the Office for Budget Responsibility. Read ICAEW's analysis and reaction.

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Insights

Chancellor walks tightrope over uncertain landscape

Despite welcome improvements to the OBR forecast and positive noises on defence spending and capital investment in the Spring Statement, the economy remains on shaky ground.
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Tax

Government takes further action to reduce tax debt

At the Spring Statement 2025, the government announced a package of new measures intended to reduce tax debt and close the tax gap. Taken together, the measures are expected to raise over £1bn in additional tax revenue per year by 2029/30.
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Tax

MTD income tax will be extended in 2028

Alongside the Spring Statement 2025, it was announced that Making Tax Digital (MTD) for income tax will be extended to those with turnover of more than £20,000 from April 2028. Taxpayers in MTD income tax will need to use commercial software for their final tax return.
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Insights

Infrastructure spend must be smart, as well as speedy

ICAEW has revealed the results of a snap poll of members, confirming that the government must better focus its infrastructure investment or risk ‘displacing’ private sector funding.
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Insights and news

HMRC increases interest rates for tax paid late
  • Article
  • 31 Mar 2025
As first announced at the Autumn Budget 2024, the interest rate charged by HMRC for late payments of most taxes and duties will increase from 7% to 8.5% from 6 April 2025.
Government considers extending R&D advanced clearance service
  • Article
  • 28 Mar 2025
After preliminary discussions with key stakeholders, including ICAEW, a consultation on widening the advanced clearance process for research and development (R&D) tax relief was published alongside the Spring Statement on 26 March 2025.
Chancellor walks tightrope over uncertain landscape
  • Article
  • 27 Mar 2025
Despite welcome improvements to the OBR forecast and positive noises on defence spending and capital investment in the Spring Statement, the economy remains on shaky ground.
Government takes further action to reduce tax debt
  • Article
  • 26 Mar 2025
At the Spring Statement 2025, the government announced a package of new measures intended to reduce tax debt and close the tax gap. Taken together, the measures are expected to raise over £1bn in additional tax revenue per year by 2029/30.
MTD income tax will be extended in 2028
  • Article
  • 26 Mar 2025
Alongside the Spring Statement 2025, it was announced that Making Tax Digital (MTD) for income tax will be extended to those with turnover of more than £20,000 from April 2028. Taxpayers in MTD income tax will need to use commercial software for their final tax return.
Economic update: key trends ahead of the Spring Statement
  • Article
  • 24 Mar 2025
The UK economy endured a poor start to 2025 amid January’s financial market turbulence. ICAEW’s Economies Director Suren Thiru discusses the implications.
Be bolder in reforming business rates, says ICAEW
  • Article
  • 18 Mar 2025
ICAEW calls for business rates to be included in an extended business tax roadmap in its response to the government’s consultation on business rates reform.
UK’s long-term fiscal challenges debated with ICAEW
  • Article
  • 13 Mar 2025
ICAEW yesterday (12 March) convened a high-powered roundtable with the Chair of the Public Accounts Committee, leading think-tanks and others to discuss the long-term fiscal challenges confronting the UK.

Public finance insights

Chancellor tightens screws to slow public finance deterioration
  • Article
  • 28 Mar 2025
Rachel Reeves used her first Spring Statement to set out a series of strict objectives to bring the public finances back under control.
Public sector finances disappoint ahead of Spring Statement
  • Article
  • 24 Mar 2025
The shortfall between receipts and public spending reached £132bn in the 11 months to February – and is potentially on track to hit £150bn by the end of the financial year.
Dark clouds over public finances as January falls short
  • Article
  • 24 Feb 2025
A smaller-than-anticipated boost from self assessment tax receipts added to pressures on the public finances ahead of the Spring Forecast next month.
Public finance woe as Chancellor battles to stay on track
  • Article
  • 23 Jan 2025
The latest public sector finance figures from the Office of National Statistics are slightly worse than expected as the economy remains fragile.

Letters to the government

ICAEW Letter to the Chancellor Spring Statement 2025
  • Representation
  • 14 Mar 2025
  • PDF (97kb)
A letter from ICAEW Chief Executive Alan Vallance to the Chancellor ahead of the Spring Statement on 26 March 2025.
ICAEW Letter to the Chief Secretary to the Treasury Spring Statement 2025
  • Representation
  • 19 Mar 2025
  • PDF (98kb)
A letter from Alison Ring, ICAEW Director for Public Sector and Taxation, to the Chief Secretary to the Treasury ahead of the Spring Statement on 26 March 2025.

Charts

Chart of the week: Spring Statement 2025
  • Article
  • 28 Mar 2025
Our chart this week looks at how the Chancellor’s headroom against her primary fiscal rule was lost and then restored.
Chart of the week: Pre-Spring Forecast forecast
  • Article
  • 21 Mar 2025
Our chart looks ahead to next week’s Spring Statement by looking back at the fiscal forecast prepared by the OBR last October.
Chart of the week: UK Regular Forces
  • Article
  • 21 Feb 2025
Our chart this week illustrates how soldier, sailor and aircrew numbers have fallen from 338,000 fifty years ago to a new low of 136,000 on 1 Jan 2025. Could this be the turning point now that defence spending is back on the agenda?
Chart of the week: Public finances per capita
  • Article
  • 17 Jan 2025
Our chart this week divides some very big numbers for the public finances by an estimated 69.2m people living in the UK to highlight how UK public spending is now in excess of £1,500 per person per month.

Economy explainers

Economy explainers: what is GDP?
  • Helpsheets and support
Journalists and politicians talk a lot about GDP. But what is it and how does it affect people and businesses? ICAEW experts offer this simple guide on GDP, why it matters and the future outlook.
Economy explainers: what are interest rates?
  • Article
Interest rates are often discussed in the media and political debates. But how are they calculated and how do they affect people and businesses? ICAEW experts offer this simple guide on interest rates, the future outlook and the challenges in managing them.
Economy explainers: what is payrolling of benefits?
  • Helpsheets and support
ICAEW’s Tax Faculty sets out the key facts employers and employees need to know about the government’s plans to mandate the reporting of income tax and class 1A national insurance contributions (NICs) for most benefits in kind (BIKs) through pay as you earn (PAYE) in real time.
Read more economy explainers

Business Confidence Monitor

Budget drives dramatic drop in business confidence
  • Article
Confidence across all UK business sectors has plunged, according to ICAEW analysis, as concerns over last year’s Budget tax measures weigh heavily on the economy.
ICAEW Business Confidence Monitor
  • Hub page
Quarterly reports on the economy which provide useful insight for finance professionals and their clients.
UK Business Confidence Monitor: National
  • Report
The latest national Business Confidence Monitor (BCM) for Q4 2024 shows a significant decline in sentiment from the previous quarter, with confidence only just remaining positive, as businesses digest the implications of the proposed tax increases in the Autumn Budget and domestic sales growth eased.

How the government can deliver growth

Drawing on members expertise and our research into business confidence, ICAEW offers policymakers advice on how to approach regulating for growth.
Read the recommendations Practical support for business
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Further resources

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Economy

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Developing policy in the public interest

See the latest work from ICAEW's Public Affairs and Policy Teams to influence policy in the public interest. Read news and insights relating to our political engagement work at a regional, national and international level.

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