On Wednesday, the Chancellor delivered her first Budget after the Labour party's victory in the polls during the summer. But, what are the key takeaways for digital and creative businesses, as well as those selling products and services?
General announcements relevant to all sectors
The National Living Wage will increase by 6.7% from £11.44 an hour to £12.21 for those aged 21 and over. The idea is also to move to a single adult rate, with the minimum wage for those under the age of 21 by being increased to £10 an hour.
The headline rate of national insurance for employers has been increased from 13.8% to 15% from April 2025. The earnings thresholds at which employers start making national insurance contributions has been reduced from £9,100 to £5,000.
Retail and hospitality
The government has announced a permanently lower business rates multiplier for retail, hospitality and leisure properties from 2026-27. There will be 40% business rates relief for retail, hospitality and leisure business, capped at up to £110,000 per business for next year and 2026.
The government will renew the tobacco duty escalator at 2% above the Retail Price Index and increase duty by 10% on hand-rolled tobacco. Following consultation, it will introduce a flat-rate duty on all vaping liquid from 2026 and has launched a technical consultation which ends on 11 December 2024.
Duty on draught alcohol will fall. Alcohol duty rates on non-draught products will increase in line with RPI from February next year.
The government is also reviewing the Soft Drinks Industry Levy. In addition, the lower rate of the Soft Drinks Industry Levy will increase from 18 pence per litre to £1.94 per 10 litres and the higher rate will increase from 24 pence per litre to £2.59 per 10 litres.
The government is supporting spirits producers, such as the Scotch Whisky industry, by removing mandatory duty stamps for spirits and increasing investment in the Spirit Drinks Verification Scheme, which allows producers to verify the geographic origin of their products. The government will introduce legislation in the Finance Bill 2024-25 to end the duty stamp scheme from 1 May 2025. The scheme’s requirements will continue to apply until that date.
The government also proposes to make technical changes to the plastic packaging tax to allow for chemical recycling.
Technology
The government is pursuing a “modern industrial strategy” and will invest £1 billion in the aerospace sector, over £2 billion in the automotive sector, and up to £520 million for a new Life Sciences Innovative Manufacturing fund.
There will be a new, multi-year investment into carbon capture and storage. Funding will be provided to 11 new green hydrogen projects across England, Scotland, and Wales.
The Chancellor announced that the Government Chief Scientific Adviser, Professor Dame Angela McLean, with National Technology Adviser Dave Smith will lead a review of barriers to the adoption of transformative technologies that could enhance innovation and productivity. The review will identify the barriers businesses face when adopting both established and novel technologies, building from existing analysis, industry insights, and the forthcoming AI Opportunities Action Plan. It will provide practical recommendations about how the government can work with businesses to address these obstacles in eight growth sectors: Advanced Manufacturing, Clean Energy Industries, Creative Industries, Defence, Digital and Technologies, Financial Services, Life Sciences, and Professional and Business Services.
The government has also published the outcome of its consultation on the Cryptoasset Reporting Framework (CARF) and Common Reporting Standard (CRS). This includes a decision to extend the CARF’s reporting requirements to UK users. The government will legislate in the Finance Bill 2024-25 and has published draft regulations to implement the revised rules. It will also provide guidance.
The government will shortly publish the AI Opportunities Action Plan setting out a roadmap to capture the opportunities of AI to enhance growth and productivity and better deliver services for the public. As already announced, it is also creating a National Data Library of public data assets.
Creative
There will be tax reliefs for the creative industries, which will provide £15 billion of support over the next five years. An Audio-Visual Expenditure Credit and a Video Game Expenditure Credit will remain. The government will broaden and diversify the talent pipeline in the creative industries by providing £3 million to expand the Creative Careers Programme for school pupils.
The government will also raise Grant-in-Aid for the National Museums and Galleries to help support their long-term sustainability and providing a package of cultural infrastructure funding that will build on existing capital schemes, with additional capital investment to support cultural organisations across the country.
Supporting elite and grassroots sport by investing in multi-use facilities across the UK and scaling up work so DCMS can deliver on plans for the UK and Ireland to host the 2028 UEFA European Football Championship. DCMS will also provide UK Sport’s Olympic and Paralympic programme with an increase in funding of £9 million.
General contracts
Late payments can bring cash‑flow challenges for small businesses, so from 1 October 2025, companies bidding for government contracts over £5 million per annum will be excluded from the procurement process if they do not pay their own suppliers within an average of 45 days.
The government also says that there are significant levels of tax avoidance and fraud in the umbrella company market, so it will make recruitment agencies responsible for accounting for PAYE on payments made to workers that are supplied via umbrella companies. Where there is no agency, this responsibility will fall to the end client business. This will take effect from April 2026.
For more information about the Budget in general, see our colleague Matt Rowbotham’s amazing round-up here.