In a refreshingly ‘dull’ Spring Statement that emphasised stability in an increasingly uncertain world, Chancellor Rachel Reeves today refrained from any significant policy changes in her speech at the despatch box.

The Office for Budget Responsibility (OBR) also made only minor updates to its economic outlook for the rest of this parliament. This included the Chancellor confirming that her headroom had increased slightly to £23.6bn from the £21.7bn she had in the autumn, thanks to lower borrowing costs and stronger equity prices driving up capital gains tax revenues.

Instead, this Spring Statement was largely an exercise in reassurance and scene-setting for the next Autumn Budget. Neither our nor the OBR’s economic forecasts suggest a third round of significant tax rises will be necessary later this year. Given the emphasis the Chancellor put today on sticking to the plan and the decisions she’s already taken, we’re hopeful further tax rises can be avoided when the Budget comes round.

However, while a pause in speculation about policy changes is welcome, there’s no shortage of risks over the next few months.

On the domestic front, any changes in leadership at Number 10 or 11 could result in a new fiscal direction. This would re-open the door to the confidence sapping pre budget uncertainty of the past few years, repeating its predictable and destabilising drag on the economy in the second half of the year.

Internationally, the latest tensions in Iran and the Middle East have also lifted wholesale oil and gas prices significantly. If this crisis continues, then it would materially raise the outlook for inflation. That would limit how far the Bank of England could cut interest rates and create fresh pressure for the Government − which made reducing the cost of living central to its strategy last autumn − to increase spending to support households.

Even if further significant tax rises are avoided this year, then rising long-term spending pressures, from extra defence funding to an ageing population, mean future tax rises still feel inevitable.

And what about tax?

The run up to the Spring Statement has been very low-key, with none of the noise and leaks which surrounded the 2025 Autumn Budget. In keeping with her commitment to hold one fiscal event a year, the Chancellor’s Spring Statement kept to the brief of responding to the OBR’s economic forecasts, with not a single mention of policy. In a speech lasting less than 25 minutes, the Chancellor reiterated the Government’s commitment to building growth through stability in the economy, giving businesses and households certainty in their finances. Tax didn’t feature at all.

With rising unemployment, particularly youth unemployment, the Government has come under mounting pressure in recent weeks to delay the planned ’accelerated’ increase in the National Minimum Wage (NMW) for 18–20 year olds. However, she shied away from addressing the issue, focusing instead on the benefits of wage growth. Speculation will no doubt continue as to whether a delay will be announced in the coming weeks.

No tax announcements today, does not however, mean no change. Many of the announcements from Autumn Budget 2024 and 2025 will take effect from April 2026, including:

• Increase in income tax rates on investment income means: individuals will pay more income tax on dividends.
• Businesses will see a reduction in the main rate of writing down allowances from 18% to 14%, increasing the period in which it takes a business to get full relief for the cost of their capital investment. A new first-year allowance took effect from January 2026.
• Gamblers will see increased costs with the increases in remote gaming duty to 40%, although bingo duty will also be abolished. (A new remote betting rate will not take effect until 2027).
• Business owners and farmers wishing to benefit from agricultural property relief and business property relief for those with agricultural or business interests, albeit these changes have been significantly watered down from the original announcement.

There are also changes to inheritance tax on pensions, as well as higher income tax rates on interest and rental income, due to come into effect from April 2027.

Of course, international events of recent days may yet overtake the Chancellor’s ‘steady as she goes’ approach to the economy, following the significant tax changes of the last two budgets. At the last budget, the Chancellor took advantage of relatively low fuel prices to announce the end of the temporary 5p cut to fuel duty with effect from September 2026.

With oil prices rising steeply due to the conflict in the Middle East, it remains to be seen whether the Chancellor will see the need to amend this policy later this year to mitigate the impact of higher oil prices on inflation.