What the Spring Statement means for you and your business

Today's Spring Statement offered very little cheer to small business owners that are grappling with rising costs. We outline the key announcements and gauge reactions from the small business community.

The Spring Statement was light on announcements and long on promises - chancellor Rachel Reeves had no tax changes to pull out of a hat; instead, she took the opportunity to unveil her growth strategy for the UK economy and outline new spending commitments - all while keeping to her iron-clad fiscal rules.

For small businesses and retailers, there was nothing in the Spring Statement to stop them from worrying about the impending increase in Employers' National Insurance Contributions (NICs), higher business rates bills and a rise in the National Living Wage. These are the changes that Reeves announced at the last Autumn Budget that will come into effect in a matter of days.

Business groups demand more support for small firms

While business groups and commentators understand that Reeves wants the Autumn Statement to be the main fiscal event of the year, many are asking for the government to do more to support small businesses and sole traders:

We need a wider tax roadmap for business: "The government must focus on reducing the cost pressures for businesses, boosting investment and exports. Firms are realistic, but they are also hurting. Within days they will be faced with higher National Insurance Contributions and a rise in the National Living Wage. Our research shows 82% of businesses will be impacted by the NI hike - with firms forced to raise prices, postpone investment and cut back on recruitment. That's why we need a wider tax roadmap for business … For the economy to grow, businesses need to thrive. Ahead of the Comprehensive Spending Review we'll be working closely with ministers to ensure that they create the right environment for firms." Shevaun Haviland, director general, British Chambers of Commerce (BCC).

Difficult few months ahead: "The chancellor has kept her promise to business, made at our conference, not to raise the [tax] burden further, and focus on the efficient delivery of public services. Firms are already braced for a difficult few months ahead, with NICs and National Living Wage increases next week. In its current form, the Employment Rights Bill risks imposing a significant regulatory burden onto companies with damaging consequences for growth, jobs and investment. A landing-zone that commands the confidence of businesses and workers can still be found by taking the time to build a consensus that will give these reforms the footing to have a positive lasting legacy." Rain Newton-Smith, ceo, Confederation of British Industry (CBI).

The government needs to listen to business: "The chancellor has rightly kept her word not to further increase business taxes and we urge her to go further in her next full Budget and actually lower the tax burden, including delivering on the promises made by Labour in opposition to transform the out-dated business rates system and make it fit for purpose in a modern economy. There should be no doubt that the government can deliver a better environment for small businesses, including as taxpayers. We therefore welcome the chancellor's commitment to open up defence procurement to more small firms … Each and every government department should do the same.

"Many small employers are worried about next month's rise in Employer National Insurance Contributions. While the chancellor's decision to double the Employment Allowance - as a result of FSB campaigning - will take all employers out of the first £10,500 of the jobs tax, there is a reality that this will only partially shield many from the overall NICs rise and their bill for employing people will therefore be higher, adding to the overall tax burden. The government needs to listen to the feedback from business on the Employment Rights Bill and change the elements which are most likely to act as a deterrent to job creation." Tina McKenzie, policy chair, Federation of Small Businesses (FSB).

A huge disappointment to the UK's SMEs: "The chancellor's Spring Statement will be a huge disappointment to the UK's small and medium sized enterprises. We know 87% of SME business leaders are eager to invest and nearly half were deferring major investment decisions until after today's Statement. Will SMEs feel more confident after today's announcements? Likely not, and we could see a worrying continuation of this 'wait and see' approach as businesses further delay decisions on areas of investment such as machinery, technology and recruitment - resulting in an economic lag for the UK. Off the back of an unpopular Autumn Budget and with increased Employer National Insurance Contributions and business rates set to rise, today's statement was a missed opportunity to support the UK's SMEs." Theo Chatha, cfo, Bibby Financial Services.

A big opportunity missed: "It's certainly good to see some more information about the next phase of Making Tax Digital for Income Tax in today's statement. However, any SMEs who were expecting some good news in terms of tax relief or business support will be very disappointed. I would like to have seen important issues such as late payment, tax simplification and long-term small business support being addressed … the chancellor could have considered radically simplifying the whole of the UK's tax system to help small businesses. Streamlining rules around VAT, income tax and National Insurance, and ensuring small business owners have a financial incentive that reflects the risks and the lack of statutory benefits that come with self-employment and business ownership, could have been a great way to support SMEs. Although we knew that the government did not intend the Spring Statement to be a full fiscal event - it is still a big opportunity missed to provide much-needed support, clarity and reassurance for the SME sector." Roan Lavery, ceo and co-founder, FreeAgent.

Too many bureaucratic hurdles: "It was very disappointing that the UK's self-employed workforce did not get a mention. The chancellor must acknowledge that the self-employed are not merely participants in our economy - they are its lifeblood. These independent professionals represent the entrepreneurial spirit that drives innovation and growth across every sector. Yet, instead of empowering these vital contributors, we're witnessing an alarming increase in bureaucratic hurdles that threaten to stifle their potential. If this government is serious about economic growth, it must recognise that hampering the self-employed with excessive regulation is counterproductive. We need bold policies that liberate, not constrain, these essential economic engines. Without them firing on all cylinders, any talk of going 'further and faster' remains empty rhetoric." Dave Chaplin, ceo, ContractorCalculator.

Nothing changes: "For years, budgets have shown that regardless of the chancellor or government, little has changed. There's a disconnect between policymakers and the reality of running a business - the constant pressure to generate sales, meet payroll and cover rising costs. Tax remains overly complex, employment laws increasingly one-sided, and late payments continue to be a persistent issue. The risks and workload only grow, yet each new government applauds our efforts while offering little meaningful support or real change." Rory MccGwire, ceo, Atom Content Marketing (publisher of the Donut websites).

Cheerleaders required: "While there was little mention of the UK's small business community in today's Spring Statement, they were in fact referenced in the small print. It was largely in connection with tax collection and cranking up penalties for tax evasion, which in our view does not reflect the good intent of the self-starters. There were positives - increases in capital spending on infrastructure and defence will provide some opportunities for small businesses in a raft of new procurement moves - these have been recently made more accessible as a result of the Procurement Act. Confirming that Making Tax Digital self-assessments will be rolled out to firms with turnover above £20,000 in 2028 is good news, but it comes with a pledge to increase VAT late payment penalties on those using the scheme from April. Entrepreneurs are workers as well, powering and creating 60% of all employment - and for them the tone of today's Statement was downbeat. Cheerleaders required." Emma Jones, ceo and founder, Enterprise Nation.

Written by Rachel Miller.