Will Labour’s agenda in the King’s Speech signal major tax changes for businesses in 2025?
As the opening of Parliament approaches on 17 July, businesses across the country are bracing for the King’s Speech, which is expected to outline the Labour Government’s legislative priorities for the coming year.
The King’s Speech will also reveal the next Budget date, as focus sharpens on the potential tax changes under Prime Minister Sir Keir Starmer and Chancellor Rachel Reeves.
Key tax changes on the horizon?
The proposed legislative agenda is poised to introduce tax changes impacting non-domiciled residents (non-doms), VAT on private school fees, and the closure of tax loopholes for private equity investors through carried interest.
These changes aim to address fairness and efficiency within the tax system, reflecting Labour’s broader economic strategies.
Implications for businesses
For business owners, these changes could make tax planning more complex and strategic.
The focus on non-doms and the private education sector suggests a redistribution of tax burdens and a potential increase in tax liabilities for certain groups.
Businesses connected to these sectors must prepare for increased financial scrutiny and potential impacts on their operational costs.
Anticipating the Budget and legislative details
As Parliament prepares to break for summer recess shortly after the King’s Speech, there is anticipation that the Government will release consultations or draft legislation during the recess, maintaining momentum on these critical issues.
The details of these tax reforms are likely to be fleshed out in the forthcoming budget, slated for no earlier than September, offering businesses a clearer picture.
Additional Government tax changes to look out for
Aside from the changes that will be outlined in the King’s Speech, there are no plans to make any other amendments to current tax policies in the immediate future.
However, it is important to prepare for such shifts, as the new Government have previously commented on tax change proposals.
These include an expected increase to the Energy Profits Levy on oil and gas and the Electricity Generators Levy, while an improved investment in research and development (R&D), particularly in sectors critical to achieving net-zero targets, has also been mooted.
Planning ahead
While the specifics of these changes will be detailed in future announcements, businesses should prepare for changes, especially during the soon to be scheduled Budget.
Business owners must stay alert to these developments and understanding how Labour’s legislative agenda could reshape the tax environment.
If you would like more information about potential tax changes and how it could affect your business, please contact our expert tram of accountancy professionals today.
