What Northern businesses want from Rachel Reeves’ Autumn Budget

Speculation over what Chancellor Rachel Reeves will announce in her Autumn Budget has been relentless, as she faces difficult choices amid economic headwinds and a reported £20-30bn gap in the public finances.

Forecasting has been complicated by Reeves preparing the ground for income tax rises at a hastily arranged press conference, then rowing back after better-than-expected OBR figures suggested the shortfall may be nearer £20bn.

Most of the debate has still centred on tax. Here, advisers and business leaders in the North set out what they expect and what they would like to see.

Energy costs and business rates

Tom Klouda, private capital tax partner at BDO in the North West, took a more positive view of how Reeves could help, putting energy incentives first. “In our most recent Economic Engine survey of 500 mid-sized business leaders, 26% of North West companies told us the single tax measure that would most support their business in 2026 was targeted incentives to cut energy/input costs, such as efficiency grants,” he said.

That was followed by simplifying or cutting business rates (24%) and improving capital allowances (20%). The survey also found that three in five (59%) firms would slow or pause expansion next year if the Budget did not include measures to support them.

“The pace of reform to business rates has been slow but changes this year will see businesses that use large, high value premises pay higher rates, with smaller high street premises retaining some business rates discounts,” Klouda said.

“It seems likely that further changes to increase business rates for warehouses used by online businesses and a gradual reduction in discounts for smaller businesses will continue in 2026 and beyond. However, the Government’s plan to phase down support for the high street retail and hospitality businesses may be delayed if this is expected to have a significant negative impact on inflationary pressures and the cost of living for consumers.

“It is also rumoured that the Chancellor is considering extending the scope of the UK’s 100% first year capital allowance rules so that the purchase of patents and licences qualifies for relief in the same way as plant and machinery does. This would be of significant benefit to many businesses operating in the eight sectors targeted in the Government’s industrial strategy.”

The self-employed

Mike Parkes, technical director at Greater Manchester online tax tool GoSimpleTax, which advises self-employed people and freelancers, said: “Every budget brings new uncertainty and added complexity to the tax system. The basic and higher rate thresholds for income tax have already been frozen until April 2028, bringing more self-employed people into the income tax net.

“Extending this freeze to the end of the Parliament could generate substantial additional revenue through fiscal drag as incomes continue to rise but leave individuals worse off and with higher tax liabilities.”

He advised self-employed people to work out where they stand by calculating their self-employed income and salary and accounting for expenses.

Parkes noted that the Budget coincides with HMRC sending more than 200,000 letters to people affected by tax changes next April. In five months, sole traders and landlords whose qualifying income exceeds £50,000 must use Making Tax Digital (MTD) for Income Tax, and HMRC has said they will need compatible software that gives real-time estimates of their tax bill through the year.

A tech founder’s wishlist

Rob Illidge, chief executive of branding tech company Vulse, set out his hopes in a LinkedIn post. “As a UK tech founder, the budget is always a moment to think about the future and how it will affect a growing business like ours,” he wrote.

His list was: real relief on employer NI so growing firms can recruit faster and keep talent; R&D tax credit support that continues and widens, particularly for SMEs that rely on data; export and global expansion incentives so UK SaaS firms can compete abroad; funding for cyber and data security to support compliance and responsible AI; and investment in skills and digital training to narrow the technical talent gap.

He said stronger R&D support would speed development of Vulse’s central AI model, hiring incentives would let it grow its engineering and customer success teams sooner, and stable tax policy would help it plan long-term product investment.

“The boy scout in me says always be prepared so we’re building flexible financial models for multiple budget outcomes, whilst strengthening partnerships with universities (including Manchester Met) to reduce reliance on external funding cycles,” he added. The company is also spreading its technology across AWS and Azure for resilience.

“The UK has world-class founders, engineers and creativity, the right support can turn that into world-class scale.”

‘Not the one with the broadest shoulders’

Steve Price, managing director of Manchester business advisory BWP Inspired, voiced concern that founders and small businesses, particularly in ecommerce and digital, would end up paying as Reeves tries to close the gap without breaking manifesto pledges to “working people.”

On his Freedom Fix channel he set out who he believes should be targeted: “Major corporations using transfer pricing to avoid UK tax. The ultra-wealthy parking assets offshore. Financial engineering that lets massive companies pay minimal tax despite huge UK revenues.

“However, it’s far easier politically to target business owners and landlords. We don’t have the PR machines or the lobbying power. I’ve worked with business owners across manufacturing, e-commerce, SaaS, and professional services. The consistent thread? They’re already stretched thin. Rising costs, squeezed margins, constant pressure to innovate and compete.

“The idea that they’re somehow insulated from economic hardship is, frankly, economically illiterate.”

His own wishlist: “Genuine wealth taxes. Higher rates on passive investment income. Closing the loopholes major corporations exploit daily. Not penalising the risk-takers who keep the economy moving.”

“Because when you over-tax mobile capital and entrepreneurial talent, you don’t get more revenue. You get capital flight. Business closures. Reduced innovation. A shrinking tax base. The exact opposite of growth,” he said.

“If you’re running a business right now and feeling the squeeze, you’re not imagining it. And you’re definitely not the one with the broadest shoulders in this equation.”