Budget 2025 – The NCC's reaction and industry analysis

The Chancellor has revealed the Autumn Statement. After much speculation we now know more about the upcoming changes that could impact business, and our own pockets, in the near future.

Here we've picked out the key elements of the Budget that are most likely to impact our members and provided our reaction. 

1. A tourism levy in England. 

   The move was announced on Tuesday, a day ahead of the Budget, and it's now confirmed that Mayors will be given the power to introduce a tourism levy on accommodation providers in their areas, despite previous denials of any such plan from within Government. 
   The levy would be applied to tourists and add a surcharge to the cost of their stay. The NCC had opposed plans for a levy, arguing that it would create administrative burden and deter tourism, and joined other signatories on a joint letter with the Tourism Alliance that was delivered to Rachel Reeves last week. 
   

   The NCC's Deputy Director General Alicia Dunne said: “The UK is already perceived as a high-cost destination, with 20% VAT applied to UK breaks. A tourism tax will only push prices higher at the most cost-conscious end of the domestic holiday market, making family-friendly caravan stays less affordable.

   “Fewer visitors mean reduced regional spending. We believe the most effective route to higher economic growth is to increase visitor volume – not impose additional taxation.

   “We will be urging members to contribute to the Government’s English tourism levy consultation, and we will be lobbying on your behalf on this critical issue.”

   It's not yet clear how this will affect holiday parks and holiday caravan lets, but it may mirror existing measures in place in Wales and Scotland that have received mixed reviews. We will be keeping a close eye on updates, and responding to the 12-week consultation which is now live on the gov.uk website.
   To have your say either complete the consultation, or click here to drop us an email with your views and we'll coordinate all replies. 
   
   

2. National Minimum Wage increase 

   The National Minimum Wage was increased on Tuesday (ahead of the Budget) meaning under-18s will now earn a minimum of £8 per hour, while 18-20 year olds will earn £10.85 and over 21s will be entitled to at least £12.71 per hour. 
   While this is largely seen as good news for low-earners and we support fair pay for workers, businesses will need to account for the increase, which is due to take effect in April. These substantial increases come at a time when tourism businesses are already dealing with higher taxation, energy, maintenance, and compliance costs.
   
   

3. Income Tax and employer National Insurance thresholds frozen

   As had been suspected, the Chancellor has decided to freeze Income Tax and employer National Insurance thresholds for a further three years to the end of the 2030/31 tax year, meaning revenue can be raised from existing taxation using an effect know as 'fiscal drag', resulting in people and their employers effectively paying more tax as salaries increase. 
   
   

4. A pay-per-mile tax on EVs from 2028 and an extension of the freeze on fuel duty

   Electric vehicles (EVs) will be charged a pay-per-mile duty from April 2028, amounting to 3p per mile. Although principally targeting private owners, the tax is highly likely to affect those running EVs as part of a business fleet. 
   Meanwhile, the Chancellor has announced a further freeze on fuel duty until September 2026. 
   
   

5. 'Salary sacrifice' pension contributions above £2,000 will attract National Insurance.
   

   Taking effect from April 2029, this means that salary-sacrificed pension contributions above £2,000 will be treated as ordinary employee pension contributions in the tax system. 
   
   

6. Funding to make apprenticeship training for under 25s completely free for SMEs

   The Chancellor announced that funding would be made available to small and medium enterprises to enable them to fully fund apprentices in training up to the age of 25. This could be good news for our industry where engineering, manufacturing and maintenance apprenticeships are common.
   
   

7. "Permanently lower tax rates" for businesses with properties worth £500k or less

   The government will introduce "permanently lower tax rates" for more than 750,000 retail, hospitality and leisure properties. The move will be funded through higher rates on properties worth £500,000 or more, such as warehouses used by online retail giants.
   
   

8. Corporation tax

   The Government has slashed writing down allowances (WDAs), which allow businesses to deduct capital costs from the profits they pay corporation tax on.
   The main rate for WDAs will be reduced from 18% to 14% from April 2026, while there will also be a new 40% first-year allowance for companies from January 2026.
   It’s expected to raise £1.5bn a year by 2029-30.