15 Possible Taxes Floated by Government!
- Shaun Crozier
- Sep 11
- 4 min read
Here's the promised review of all the ideas that have been floated so far by government in the run up to the budget set for 26th November and how the tax measures being considered could potentially impact you. 15 possible taxes floated by government that would impact everyone.
Speculation is mounting about the direction of tax policy under Chancellor Rachel Reeves. Our economy remains sluggish with higher borrowing costs, and a fiscal gap estimated at between £40-50 billion!
Against this backdrop, wealth-based taxes, reforms to pensions, and measures targeting both individuals and businesses are firmly on the table.
Inheritance Tax (IHT) Reforms
Inheritance Tax changes being considered.Lifetime gifting rules could be under review with the Treasury capping the value of exempt gifts and tighten the seven-year rule. Agricultural & Business Relief curbed and full relief could be capped at the first £1 million of qualifying assets, with tax applied thereafter.
Impact: Families, business owners, and farmers could face higher tax liabilities and greater complexity in planning the passing of assets to children/beneficiaries.
Capital Gains Tax (CGT) Adjustments
The Chancellor may seek more revenue from capital gains. Rates or thresholds could be revised, aligning them closer to income tax rates or removing reliefs.
Impact: This could affect investor confidence and property transactions.
Pension Tax Relief and Lump Sum Restrictions
Pensions could be targeted for reform with a flat-rate tax relief to replace the current marginal relief system, reducing benefits for higher-rate taxpayers.The Tax-free lump sum currently £268,275, could fall to £75,000–£100,000.
Employer contributions again, with National Insurance being considered to be levied on employer contributions, and salary sacrifice arrangements restricted.
Impact: High earners and company directors using pensions for tax efficiency could see significant changes in planning strategies.
Lifetime Allowance (LTA) and Lump Sum Allowances
The Lifetime Allowance was abolished in 2024, replaced with allowances such as:Lump Sum Allowance (LSA) – £268,275Lump Sum & Death Benefit Allowance – £1,073,100
Impact: Those with large pension pots should plan for potential tightening of allowances or higher tax on benefits.
Proposed NI on Partnership Income & Rental Income
A new policy proposal suggests introducing a form of "Partnership/Rental Income NICs", which would align National Insurance treatment of partnership/landlord’s income with that of employment income.
Partners/landlords may need to reconsider their business structures.
Freezing Tax Thresholds – The “Stealth Tax”
Labour may continue the freeze on income tax and NI thresholds and leave the dread fiscal drag to quietly increase tax revenue as wages rise.
Impact: Many households will feel the squeeze even without formal tax rate hikes.
Wealth Taxes
The possibility of a wealth tax remains under consideration. Proposed models include annual levies on net wealth above a certain threshold. In theory it could be difficult for HMRC to introduce due to a lack of robust wealth data and risk of capital flight.
Impact: While unlikely to materialize in full form this year, incremental steps—such as higher CGT or IHT—could serve as a proxy.
“Sin” Taxes and Levies
New or increased levies on gambling, unhealthy foods, fuel duty (though politically sensitive)
These allow the government to argue fairness and health benefits while raising revenue.
Air Passenger Duty (APD) & Vehicle Excise Duty (VED)
APD rises scheduled with £1 increase on domestic flights, £2 on short-haul, £12 on long-haul economy, and private jets up 50%. VED reforms with higher rates for high-emission vehicles to encourage greener transport.
Tackling the Tax Gap
HMRC aims to raise £6.5 billion annually by increasing compliance staffing and introducing digital reforms and faster debt recovery.
ISA Allowances and Tax on Savings
The current ISA allowance remains at £20,000 per year for the 2025/26 tax year, frozen until 2030. This allowance includes Cash, Stocks & Shares, Lifetime, and Innovative Finance ISAs.
There have been reports that the government is considering reducing the Cash ISA allowance (e.g., limiting contributions to £4,000–£5,000) while keeping the overall ISA limit unchanged to encourage investment in stocks and shares.These proposed reforms are currently on hold for consultation.
Tax on Savings Outside ISA's
are subject to the Personal Savings Allowance (PSA):
Basic-rate taxpayers: £1,000 tax-free interest
Higher-rate taxpayers: £500
Additional-rate taxpayers: £0
Rising interest rates and frozen thresholds mean millions more savers will be paying tax on savings interest, with expected savings tax revenue jumping from £1.4 billion to £10.4 billion.
Proposed Property Tax Reforms
Annual Proportional Property Tax
Plans are being considered to replace stamp duty and council tax with a proportional annual property tax, targeting homes over a specified threshold (potentially £500,000).
Capital Gains Tax on High-Value Primary Residences
The government is exploring removing the CGT exemption for primary residences valued above £1.5 million.
Homeowners of high-value properties might be taxed between 18–24% when selling their main residence.
Mansion Tax / Annual Levy on Expensive Homes
A mansion tax or annual levy on high-value homes is under discussion.
Some proposals envision rates such as 0.54% annually for homes over £500,000, and 0.81% for properties above £1 million, possibly applied to new buyers.
Stamp Duty Reform
The Chancellor is weighing replacing stamp duty on primary residences with a seller-paid, proportional property tax.
Unlike the current upfront stamp duty, this would be spread over time through annual levies.
Council Tax Reforms and Banding Update
The outdated council tax system—based on 1991 property values—is under scrutiny.
Proposals include replacing or reforming council tax, possibly through a local property tax or revalued bands to better reflect current property values and redistribute local funding more equitably.
What Does This Mean for You?
Wow, that is a devil of a list but its looking likely you can expect more taxes on wealth transfers, pensions, and investment income.
Important: Planning early around IHT, pensions, and capital gains will be key.
Final Thoughts
The Autumn Budget is shaping up to be one of the most consequential in a decade. While headline tax rates may remain unchanged, the cumulative effect of relief restrictions, freezes (fiscal drag), and targeted levies could prove to be significant.
If you have assets, pension pots, or property and investments you should take early action to establish if adapting any strategies could improve and protect you.
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