Chancellor Rachel Reeves has delivered her Autumn Statement, with few headline-grabbing measures for the travel industry.
The build-up to this year's Budget was punctuated by frequent leaks of many of Reeves's key announcements, and played out against a gloomy economic backdrop.
However, there was some good news for the high street, plus measures that will boost the spending power of older travellers and those with savings.
Here are the main points.
Business rates
Reeves confirmed there would be reduced rates for “over 750,000” high street businesses, with the “lowest rates since 1991”, but did not give firm details.
This, she said, would be paid for by higher rates on properties worth more than £500,000. Reeves added there would be a package of support for those seeing large bill increases.
Another boost is that seven unnamed mayors will be given £13 billion for local investment.
Taxation
There will be no increases to the rates of National Insurance, VAT or income tax. However, Reeves said she is “asking everyone to make a contribution” and has frozen income tax thresholds for a further three years, meaning more people will be dragged into the higher bands as their wages increase.
Corporation tax rates will also remain the same. Elsewhere, there will be a new 40% first-year investment allowance for start-up businesses, while the amount of Capital Gains Tax exemption when a business is sold into employee ownership falls from 100% to 50%.
Air Passenger Duty
No change was announced by Reeves in her speech, but the government will uprate all rates of APD in line with inflation from 1 April 2027. These rates will be rounded to the nearest penny.
In addition, higher rate APD will be extended to all private jet flights above 5.7 tonnes from April 2027 to ensure “those who can afford to fly privately make a fair contribution alongside commercial air passengers”.
Cost of living
Fuel duty will be frozen until September 2026 and for the first time in 30 years, peak rail fares will not increase.
Energy bills
Reeves says bills will fall by £150 a year from April 2026 owing to her decision to axe an ECO – Energy Company Obligation – scheme introduced by the last government.
Pensions
The government has backed on from plans to reduce the lump sum amount savers can withdraw from their pension pots tax-free, which is good news for travel as many choose to fund their trip of a life-time in this way.
Meanwhile, many pensions will rise by 4.8% – around £550 more per year – from 2026. This is due to the triple lock policy, which means the state pension increases annually by the highest rate of three factors – inflation, average wage growth or a minimum 2.5%.
This year, average wage growth of 4.8% is the determining factor.
Savings
The £20,000 ISA allowance will remain for the over-65s, but for those under this age, £8,000 of this must be invested in a stocks and shares ISA. This will take effect from April 2027.
Minimum wages and apprentices
Rates for both change on 1 April every year. The hourly minimum wage rate is currently £12.21 for those aged 21 and over, £10 for those aged 18 to 20 and £7.55 for those aged under 18 and apprentices.
From 1 April 2026, the hourly rate for over-21s will rise by 50p to £12.71, with workers aged 18-20 seeing an 85p rise to £10.85, and under-18s and apprentices getting 45p more to £8 an hour.
The National Living Wage for the over 21s will increase by 4.1% to £12.71 an hour from April 2026. All the increases are ahead of inflation and designed to lift the lowest paid in the workforce.
Funding for under-25s apprenticeships will be free for SMEs.
England tourism levy
Mayors in England will be given the power to levy a tax on overnight stays in their area. The government says the fee would apply to visitors’ overnight trips, “and it would be up to mayors and other local leaders to introduce a modest charge if it’s right for their area”.
It added: “The move would ensure UK mayors have the same powers as their counterparts in cities like New York, Paris and Milan, where charges on short-term trips are already commonplace.”
Money raised could fund local projects “that could potentially help attract more visitors, without needing approval from central government”. A consultation period closes on 18 February.
The bigger picture
Reeves said the independent Office of Budget Responsibility had upgraded its forecast of economic growth from 1% in the spring to 1.5% now. However, £1 in every £10 the country earns is spent in interest payments on national debt of £2.6 trillion.
The OBR expects inflation to reach 3.5% for this year, slightly higher than the March estimate of 3.2%. Inflation is forecast to fall to 2% for 2027 and the following two years.
