Finance Act 2025

• (a) as a result of section 44(4) of FA 2003 the effective date of a land transaction is before 31 October 2024, and

• (b) the contract concerned is completed by a conveyance on or after that date,

section 44(8) of that Act is not to apply in relation to that conveyance if the sole reason that (but for this subsection) it would have applied is that the increased rates provided for by this section would have had effect in relation to that conveyance.

• (6) Section 44(10) of FA 2003 applies for the purposes of subsection (5).

Annual tax on enveloped dwellings

Alternative finance: land in England, Scotland or Northern Ireland

54

• (1) In section 157 of FA 2013 (land in England or Northern Ireland sold to financial institution and leased to person under alternative finance arrangements)—

• (a) in subsection (2), for “If the lessee is a company, this Part” substitute “This Part”;

• (b) in subsection (4), after “company” (in each place it appears) insert “or individual”;

• (c) in subsection (9), after “subsections” insert “(2), (3),”.

• (2) In section 157A of FA 2013 (land in Scotland sold to financial institution and leased to person under alternative finance arrangements)—

• (a) in subsection (4), for “If the lessee is a company, this Part” substitute “This Part”;

• (b) in subsection (6), after “company” (in each place it appears) insert “or individual”;

• (c) in subsection (11), after “subsections” insert “(4), (5),”.

• (3) The amendments made by this section are treated as having come into force on 30 October 2024.

Alternative finance: land in Wales

55

• (1) In section 157 of FA 2013, in the heading and subsection (1)(b), omit “, Wales”.

• (2) After section 157A of FA 2013 insert—

(157B) (1) This section applies where— (a) paragraph 2 of Schedule 10 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 (anaw 1) (land in Wales sold to financial institution and leased to person) applies in relation to arrangements entered into between a financial institution and another person (“the lessee”), and (b) the land in which the institution purchases a major interest under the first transaction is in Wales and consists of or includes one or more dwellings (or parts of a dwelling). (2) This Part has effect in relation to times when the arrangements are in operation as if— (a) the interest held by the financial institution as mentioned in subsection (3)(b) were held by the lessee (and not by the financial institution), and (b) the lease or sub-lease granted under the second transaction had not been granted. (3) The reference in subsection (2) to times when the arrangements are in operation is to times when— (a) the lessee holds the leasehold interest granted to it under the second transaction, and (b) the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution. (4) A company or individual treated under subsection (2)(a) as holding an interest at a particular time is treated as holding it as a member of a partnership if at the time in question the company or individual holds the leasehold interest as a member of the partnership (and this Part has effect accordingly in relation to the other members of the partnership). (5) In relation to times when the arrangements operate for the benefit of a collective investment scheme, this Part has effect as if— (a) the interest held by the financial institution as mentioned in subsection (6)(b) were held by the lessee for the purposes of a collective investment scheme (and were not held by the financial institution), and (b) the lease or sub-lease granted under the second transaction had not been granted. (6) The reference in subsection (5) to times when the arrangements operate for the benefit of a collective investment scheme is to times when— (a) the lessee holds the leasehold interest for the purposes of a collective investment scheme, and (b) the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution. (7) In this section— - “financial institution” has the meaning given by paragraph 8 of Schedule 10 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017; - “the first transaction” has the same meaning as in paragraph 2 of Schedule 10 to that Act; - “further transaction” has the same meaning as in paragraph 2 of Schedule 10 to that Act; - “the leasehold interest” means the interest granted to the lessee under the second transaction; - “the second transaction” has the same meaning as in paragraph 2 of Schedule 10 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. (8) The reference in subsection (1) to a major interest in land is to be read in accordance with section 68 of the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017. (9) Where the lessee is an individual, references in subsections (2), (3), (5) and (6) to the lessee are to be read, in relation to times after the death of the lessee, as references to the lessee’s personal representatives.

• (3) The amendments made by this section are treated as having come into force on 30 October 2024.

Stamp duty and stamp duty reserve tax

Testing of FMI technologies or practices

56

• (1) The Treasury may by regulations make provision about stamp duty or stamp duty reserve tax in connection with regulations made under section 13 of the Financial Services and Markets Act 2023 (testing of FMI technologies or practices).

• (2) Regulations under subsection (1) may—

• (a) disapply, or modify the application of, an Act;

• (b) apply an Act with or without modifications,

but may not amend or repeal an Act.

• (3) Regulations under subsection (1) must be made by statutory instrument.

• (4) A statutory instrument containing provision (whether alone or with other provision) that has the effect of increasing the amount of duty or tax that is chargeable in respect of any instrument, transfer or agreement to transfer above the amount that would have been chargeable in the absence of regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by resolution of, the House of Commons.

• (5) A statutory instrument that does not contain such provision is subject to annulment in pursuance of a resolution of the House of Commons.

Inheritance tax

Rate bands etc for tax years 2028-29 and 2029-30

57

In section 86 of FA 2021 (no indexation of rate bands, residential enhancement and taper threshold for tax years up to 2027-28)—

• (a) for “or 2026” substitute “, 2026, 2027 or 2028”, and

• (b) in the heading, for “2027-28” substitute “2029-30”.

EBTs: prohibition on applying property for benefit of participators etc

58

• (1) IHTA 1984 is amended as follows.

• (2) In section 13 (dispositions by close companies for benefit of employees), in subsection (2)—

• (a) in paragraph (a), after “who is” insert “, at the time of the disposition,”;

• (b) in paragraph (b), after “who is” insert “, at the time of the disposition,”;

• (c) in paragraph (c), for “has been” substitute “is”;

• (d) in paragraph (d), after “who is” insert “, at the time of the disposition or any later time,”.

• (3) In section 28 (employee trusts), in subsection (4)—

• (a) for paragraph (a) substitute—

(a) a person who is, at the time of the transfer of value mentioned in subsection (1), a participator in the company mentioned in that subsection; or

;

• (b) in paragraph (b), after “who is” insert “, at the time of the transfer of value mentioned in subsection (1),”;

• (c) in paragraph (c), for “has been” substitute “is”;

• (d) for paragraph (d) substitute—

(d) any person who is, at the time of the transfer of value mentioned in subsection (1) or any later time, connected with a person within paragraph (a), (b) or (c).

.

EBTs: restriction on proportion of beneficiaries who may be participators etc

59

• (1) IHTA 1984 is amended as follows.

• (2) In section 13 (dispositions by close companies for benefit of employees), after subsection (4) insert—

(4A) Subsection (4)(a) does not apply if, immediately after the disposition of property mentioned in subsection (1), more than 25% of relevant beneficiaries are (disregarding subsection (4)(a)) persons falling within subsection (2)(a) to (d). (4B) In subsection (4A) “relevant beneficiary” means a person who— (a) is a person for whose benefit the trusts permit the property to be applied, and (b) is a person employed by or holding office with the company mentioned in subsection (1).

.

• (3) In section 28 (employee trusts), after subsection (6) insert—

(6A) Subsection (6) does not apply if, immediately after the transfer of value mentioned in subsection (1), more than 25% of relevant beneficiaries are (disregarding subsection (6)) persons falling within subsection (4)(a) to (d). (6B) In subsection (6A) “relevant beneficiary” means a person who— (a) is a person for whose benefit the trusts permit the settled property to be applied, and (b) is a person employed by or holding office with the company mentioned in subsection (1).

.

• (4) In section 75 (exemption from charge under section 65 where property becomes subject to employee benefit trust), in subsection (3), in the opening words, after “section 28(4)” insert “and (6A)”.

• (5) This section is treated as having come into force on 30 October 2024.

EBTs: shares entering trust to have been held for two years

60

• (1) IHTA 1984 is amended as follows.

• (2) In section 28 (employee trusts)—

• (a) in subsection (1), after paragraph (b) insert

, and (c) the individual has, throughout the period of two years ending with the date of the transfer, been beneficially entitled to the shares in or securities of the company that become comprised in the settlement.

;

• (b) after subsection (7) insert—

(8) A reference in subsection (1)(c) to shares in or securities of a company includes, in a case in which a reorganisation of share capital has occurred, the original shares to which the new holding relates. (9) In subsection (8)— (a) “reorganisation of share capital” means a transaction to which section 127 of the 1992 Act (equation of original shares and new holding) applies or would apply but for section 134 of that Act; (b) “the original shares” and “the new holding” have the meaning given by section 126(1) of the 1992 Act.

.

• (3) In section 75 (exemption from charge under section 65 where property becomes subject to employee benefit trust)—

• (a) in subsection (2), after paragraph (c) insert

; and (d) the shares in or securities of the company have been comprised in the settlement mentioned in section 65(1) throughout the period of two years ending with the date on which they cease to be relevant property.

;

• (b) after subsection (3) insert—

(4) A reference in subsection (2)(d) to shares in or securities of a company includes, in a case in which a reorganisation of share capital has occurred, the original shares to which the new holding relates. (5) In subsection (4)— (a) “reorganisation of share capital” means a transaction to which section 127 of the 1992 Act (equation of original shares and new holding) applies or would apply but for section 134 of that Act; (b) “the original shares” and “the new holding” have the meaning given by section 126(1) of the 1992 Act.

.

• (4) This section is treated as having come into force on 30 October 2024.

Agricultural property relief: environmental management agreements

61

• (1) In Chapter 2 of Part 5 of IHTA 1984 (agricultural property relief), omit section 124C (application of agricultural property relief to land in habitat schemes) and insert—

(124C) (1) For the purposes of this Chapter, land is to be treated as agricultural property occupied for the purposes of agriculture if— (a) the land was agricultural property throughout the period of two years ending with the day on which it became subject to an environmental management agreement, and (b) since that day, it has been used and managed in accordance with the agreement (whether or not the agreement is still in place). (2) A building occupied with land that is treated as agricultural property occupied for the purposes of agriculture under subsection (1) is to be treated in the same way if— (a) it is used in connection with the use and management of the land in accordance with the environmental management agreement (whether or not the agreement is still in place) and is of a character appropriate to the land, (b) either— (i) it was built for the purpose of being used in connection with that use and management (whether or not the agreement was still in place), or (ii) it was occupied with the land immediately before the land became subject to the environmental management agreement and was of a character appropriate to the land as it stood at that time, and (c) it is not otherwise agricultural property occupied for the purposes of agriculture. (3) For the purposes of subsection (2), where a building is occupied with land that is treated as agricultural property under subsection (1) and land that is otherwise agricultural property occupied for the purposes of agriculture, the question of whether the building is of a character appropriate to the land is to be considered by reference to all of that land. (4) The agricultural value of property that is agricultural property as a result of this section is to be taken to be the value that would be the value of the property if it were subject to a perpetual covenant prohibiting its use otherwise than in accordance with the environmental management agreement (whether or not the agreement is still in place) (and section 115(3) does not apply). (5) In subsection (1)(a) the reference to agricultural property includes land treated as agricultural property under this section. (6) In this section— - “environmental management agreement” means a legally enforceable agreement between an occupier or other person with a right in land and a public authority which— is entered into for the purpose of protecting, restoring or enhancing the natural environment, or natural resources, of land or water, and in practice requires the land to be used and managed in a way that would (apart from this section) prevent it from being agricultural property occupied for the purposes of agriculture; - “land” includes pasture and woodland; - “public authority” means a person that is in entering the environmental management agreement— exercising public functions, or acting under arrangements with a public authority in relation to the exercise of the authority’s functions. (7) This section does not apply in respect of an environmental management agreement that ended before 6 March 2024.

• (2) The amendments made by this section have effect—

• (a) in relation to transfers of value made on or after 6 April 2025, and

• (b) in relation to occasions on or after that date on which tax falls to be charged under Chapter 3 of Part 3 of IHTA 1984.

National Savings Bank: statements from HMRC no longer to be required

62

• (1) In the National Savings Regulations 2015 (S.I. 2015/623), omit regulation 55 (inheritance tax chargeable on death of depositors).

• (2) In the National Savings (No. 2) Regulations 2015 (S.I. 2015/624), omit regulation 90 (inheritance tax chargeable on death of holders of stock or certificates).

Alcohol duty

Rates of alcohol duty

63

• (1) Part 2 of F(No.2)A 2023 (alcohol duty) is amended as follows.

• (2) For Schedule 7 (main rates) substitute—

Schedule 7

Alcoholic strength of alcoholic product	Rate of duty per litre of alcohol in the product
Less than 3.5%	£9.61
At least 3.5% but less than 8.5%	See Table 2
At least 8.5% but not exceeding 22%	£29.54
Exceeding 22%	£32.79
Description of alcoholic product (of an alcoholic strength of at least 3.5% but less than 8.5%)	Rate of duty per litre of alcohol in the product
---	---
Still cider Sparkling cider of an alcoholic strength not exceeding 5.5%	£10.02
Beer	£21.78
Spirits, wine and other fermented products Sparkling cider of an alcoholic strength exceeding 5.5%	£25.67

.

• (3) For Schedule 8 (reduced rates for qualifying draught products) substitute—

Schedule 8

Description of alcoholic product	Rate of duty per litre of alcohol in the product
Alcoholic products of an alcoholic strength of less than 3.5%	£8.28
Still cider of an alcoholic strength of at least 3.5% Sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	£8.63
Beer, spirits, wine and other fermented products of an alcoholic strength of at least 3.5% (but less than 8.5%) Sparkling cider of an alcoholic strength exceeding 5.5%	£18.76

.

• (4) For Schedule 9 (duty discount for small producer alcoholic products)—

Schedule 9

Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	9.61	-
2	5	50	2.44	48.05
3	50	100	1.47	157.99
4	100	200	0.49	231.28
5	200	600	-	280.15
6	600	1000	-	280.15
7	1000	4500	-0.08	280.15
Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	6.35	-
2	5	50	2.44	31.76
3	50	100	1.47	141.70
4	100	200	0.49	214.99
5	200	600	-	263.86
6	600	1000	-	263.86
7	1000	4500	-0.08	263.86
Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	10.02	-
2	5	50	2.55	50.10
3	50	100	1.53	164.78
4	100	200	0.51	241.24
5	200	600	-	292.21
6	600	1000	-	292.21
7	1000	4500	-0.08	292.21
Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	19.94	-
2	5	112.5	11.08	99.68
3	112.5	225	9.97	1290.33
4	225	450	5.54	2411.75
5	450	900	3.32	3657.77
6	900	1350	-	5153.00
7	1350	4500	-1.64	5153.00
Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	25.67	-
2	5	50	2.61	128.35
3	50	100	2.61	245.84
4	100	200	1.31	376.37
5	200	600	-	506.91
6	600	1000	-	506.91
7	1000	4500	-0.14	506.91
Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	20.89	-
2	5	50	2.61	104.43
3	50	100	2.61	221.92
4	100	200	1.31	352.46
5	200	600	-	483.00
6	600	1000	-	483.00
7	1000	4500	-0.14	483.00
Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%	Alcoholic products, other than spirits, of an alcoholic strength of less than 3.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	8.28	-
2	5	50	2.11	41.40
3	50	100	1.26	136.13
4	100	200	0.42	199.28
5	200	600	-	241.38
6	600	1000	-	241.38
7	1000	4500	-0.07	241.38
Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%	Spirits of an alcoholic strength of less than 3.5%
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	5.47	-
2	5	50	2.11	27.37
3	50	100	1.26	122.09
4	100	200	0.42	185.24
5	200	600	-	227.34
6	600	1000	-	227.34
7	1000	4500	-0.06	227.34
Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%	Still cider of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength of at least 3.5% but not exceeding 5.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	8.63	-
2	5	50	2.20	43.15
3	50	100	1.32	141.93
4	100	200	0.44	207.78
5	200	600	-	251.68
6	600	1000	-	251.68
7	1000	4500	-0.07	251.68
Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%	Beer of an alcoholic strength of at least 3.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	17.17	-
2	5	112.5	9.54	85.86
3	112.5	225	8.59	1111.41
4	225	450	4.77	2077.34
5	450	900	2.86	3150.59
6	900	1350	-	4438.49
7	1350	4500	-1.41	4438.49
Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%	Wine and other fermented products of an alcoholic strength of at least 3.5%; sparkling cider of an alcoholic strength exceeding 5.5%
---	---	---	---	---
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	18.76	-
2	5	50	1.91	93.80
3	50	100	1.91	179.66
4	100	200	0.95	275.06
5	200	600	-	370.46
6	600	1000	-	370.46
7	1000	4500	-0.11	370.46
Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%	Spirits of an alcoholic strength of at least 3.5%
Discount band	Start threshold (hectolitres)	End threshold (hectolitres)	Marginal discount (£)	Cumulative discount (£)
1	0	5	15.26	-
2	5	50	1.91	76.32
3	50	100	1.91	162.18
4	100	200	0.95	257.58
5	200	600	-	352.98
6	600	1000	-	352.98
7	1000	4500	-0.10	352.98

.

• (5) In consequence of the amendments made by the preceding subsections of this section, in Schedule 2 to the Travellers’ Allowances Order 1994 (which provides in certain circumstances for a simplified calculation of excise duty on goods brought into Great Britain)—

• (a) in the entry relating to beer, in the second column, for “£0.88” substitute “£0.91”,

• (b) in the entry relating to still wine, in the second column, for “£3.28” substitute “£3.40”,

• (c) in the entry relating to sparkling wine, in the second column, for “£3.28” substitute “£3.40”,

• (d) in the entry relating to cider, in the second column, for “£0.44” substitute “£0.46”,

• (e) in the entry relating to sparkling cider of an alcoholic strength not exceeding 5.5% by volume, in the second column, for “£0.44” substitute “£0.46”,

• (f) in the entry relating to sparkling cider of an alcoholic strength exceeding 5.5% but less than 8.5% by volume, in the second column, for “£1.73” substitute “£1.80”,

• (g) in the entry relating to other fermented products, in the second column, for “£3.28” substitute “£3.40”, and

• (h) in the entry relating to spirits, in the second column, for “£11.88” substitute “£12.30”.

• (6) The amendments made by this section are treated as having come into force on 1 February 2025.

Abolition of duty stamps for alcoholic products

64

• (1) Section 112 of, and Schedule 12 to, F(No.2)A 2023 (which make provision about duty stamps for retail containers of alcoholic products) are repealed.

• (2) In consequence of the repeals made by subsection (1)—

• (a) in section 12(2) of FA 1994, omit paragraph (ca),

• (b) in section 13A(2) of that Act—

• (i) in paragraph (ea), omit sub-paragraph (ii) and the “or” before it, and

• (ii) omit paragraphs (f) and (g),

• (c) in paragraph 1 of Schedule 41 to FA 2008, in the Table, omit the entry relating to alcohol duty and duty stamps,

• (d) in section 119 of F(No.2)A 2023—

• (i) omit subsection (4), and

• (ii) in subsections (5) and (8)(a), omit “or subsection (4)”,

• (e) in Schedule 11 to that Act, omit paragraph 1(4),

• (f) in Schedule 13 to that Act, omit paragraph 9,

• (g) in the form of United Kingdom Internal Accompanying Document, set out in Schedule 4 to the Excise Warehousing (Etc.) Regulations 1988 (S.I. 1988/809), in the explanatory note to Box 18a, omit the sentence beginning “If alcohol or alcoholic beverages are stamped”,

• (h) the Duty Stamps Regulations 2006 (S.I. 2006/202) are revoked.

• (3) In consequence of the revocation of the Duty Stamps Regulations 2006 the following are revoked—

• (a) paragraphs 3 and 4 of Schedule 2 to the Finance Act 2008, Schedule 40 (Appointed Day, Transitional Provisions and Consequential Amendments) Order 2009 (S.I. 2009/571),

• (b) paragraphs 20 and 21 of Schedule 2 to the Excise Goods (Holding, Movement and Duty Point) Regulations 2010 (S.I. 2010/593),

• (c) paragraph 49 of Schedule 3 to the Tribunals, Courts and Enforcement Act 2007 (Consequential Amendments) Order 2012 (S.I. 2012/2404),

• (d) regulation 4 of the Spirits (Amendment) Regulations 2013 (S.I. 2013/1229),

• (e) regulations 8 to 18 and 23 of the Excise Duties (Miscellaneous Amendments) (EU Exit) (No. 2) Regulations 2019 (S.I. 2019/15),

• (f) regulations 95 and 97 of the Excise Duties (Northern Ireland Miscellaneous Modifications and Amendments) (EU Exit) Regulations 2020 (S.I. 2020/1559),

• (g) regulations 13, 17 and 26 of the Travellers’ Allowances and Miscellaneous Provisions (EU Exit) Regulations 2020 (S.I. 2020/1412),

• (h) regulation 7 of the Excise Duties (Removal of Alcoholic Liquor to Northern Ireland and Miscellaneous Amendments) Regulations 2021 (S.I. 2021/1282),

• (i) Part 2 of Schedule 2 to the Excise Duties and Value Added Tax (Northern Ireland) (Miscellaneous Modifications and Amendments) Regulations 2023 (S.I. 2023/64), and

• (j) paragraph 10 of the Schedule to the Finance (No. 2) Act 2023, Part 2 (Alcohol Duty) (Appointed Day, Savings, Consequential Amendments and Transitional Provisions) Regulations 2023 (S.I. 2023/884).

• (4) The amendments made by this section come into force on 1 May 2025.

• (5) Where before that date a person incurs an obligation under the Duty Stamps Regulations 2006 (S.I. 2006/202) to take any steps, no requirement to take those steps continues on or after that date (despite section 16 of the Interpretation Act 1978).

• (6) But subsection (5) does not apply to any obligation to preserve records made for the purposes of those regulations.

Tobacco products duty

Rates of tobacco products duty

65

• (1) In Schedule 1 to TPDA 1979 (table of rates of tobacco products duty), for the Table substitute—

1 Cigarettes	An amount equal to the higher of— 16.5% of the retail price plus £334.58 per thousand cigarettes, or £446.67 per thousand cigarettes.
2 Cigars	£417.33 per kilogram
3 Hand-rolling tobacco	£476.83 per kilogram
4 Other smoking tobacco and chewing tobacco	£183.49 per kilogram
5 Tobacco for heating	£343.91 per kilogram

.

• (2) In consequence of the provision made by subsection (1), in Schedule 2 to the Travellers’ Allowances Order 1994 (which provides in certain circumstances for a simplified calculation of excise duty on goods brought into Great Britain)—

• (a) in the entry relating to cigarettes, for “£422.80” substitute “£446.67”,

• (b) in the entry relating to hand rolling tobacco, for “£412.32” substitute “£476.83”,

• (c) in the entry relating to other smoking tobacco and chewing tobacco, for “£173.68” substitute “£183.49”,

• (d) in the entry relating to cigars, for “£395.03” substitute “£417.33”,

• (e) in the entry relating to cigarillos, for “£395.03” substitute “£417.33”, and

• (f) in the entry relating to tobacco for heating, for “£97.66” substitute “£103.17”.

• (3) The amendments made by this section are treated as having come into force at 6pm on 30 October 2024.

Taxes relating to vehicles

Rates of vehicle excise duty for light passenger or light goods vehicles etc

66

• (1) Schedule 1 to VERA 1994 (annual rates of vehicle excise duty) is amended as follows.

• (2) In paragraph 1 (general rate)—

• (a) in sub-paragraph (2) (vehicle not covered elsewhere in Schedule with engine cylinder capacity exceeding 1,549cc), for “£345” substitute “£360”, and

• (b) in sub-paragraph (2A) (vehicle not covered elsewhere in Schedule with engine cylinder capacity not exceeding 1,549cc etc), for “£210” substitute “£220”.

• (3) In paragraph 1B (graduated rates for light passenger vehicles registered before 1 April 2017), omit paragraph (b) together with the “and” before that paragraph.

• (4) In paragraph 1B, for the Table substitute—

CO2 Emissions Figure	CO2 Emissions Figure
(1)	(2)	(3)
Exceeding or, in the first row, equal to or exceeding	Not exceeding	Rate
g/km	g/km	£
0	100	20
100	110	20
110	120	35
120	130	165
130	140	195
140	150	215
150	165	265
165	175	315
175	185	345
185	200	395
200	225	430
225	255	735
255	—	760

.

• (5) In the sentence immediately following the Table in that paragraph, for the words from “as if” to the end substitute “as if, in column (3), in the last two rows, “430” were substituted for “735” and “760”.”

• (6) Omit paragraphs 1C to 1F together with the italic heading before paragraph 1C (which provide for a reduced rate).

• (7) In paragraph 1GA (vehicles to which Part 1AA applies), in sub-paragraph (3), omit paragraph (c).

• (8) In paragraph 1GC (graduated rates for first licence for light passenger vehicles registered on or after 1 April 2017), in sub-paragraph (2), omit paragraph (b) together with the “and” before that paragraph.

• (9) In paragraph 1GC, for Table 1 (vehicles other than higher rate diesel vehicles) substitute—

CO2 Emissions Figure	CO2 Emissions Figure
(1)	(2)	(3)
Exceeding or, in the first row, equal to	Not exceeding	Rate
g/km	g/km	£
0	0	10
0	50	110
50	75	130
75	90	270
90	100	350
100	110	390
110	130	440
130	150	540
150	170	1360
170	190	2190
190	225	3300
225	255	4680
255	—	5490

.

• (10) In that paragraph, for Table 2 (higher rate diesel vehicles) substitute—

CO2 Emissions Figure	CO2 Emissions Figure	Rate
(1)	(2)	(3)
Exceeding or, in the first row, equal to or exceeding	Not exceeding	Rate
g/km	g/km	£
0	50	130
50	75	270
75	90	350
90	100	390
100	110	440
110	130	540
130	150	1360
150	170	2190
170	190	3300
190	225	4680
225	255	5490
255	—	5490

.

• (11) In paragraph 1GD(1)(rates for any other licence for light passenger vehicles registered on or after 1 April 2017), for the words from “applicable to the vehicle is—” to the end substitute “applicable to the vehicle is £195.”

• (12) In paragraph 1GE(2) (rates for light passenger vehicles registered on or after 1 April 2017 with a price exceeding £40,000), for the words from “applicable to the vehicle is—” to the end substitute “applicable to the vehicle is £620.”

• (13) In paragraph 1J(a) (rates for light goods vehicles that are not pre-2007, post-2008 lower emission vans or pre-2011 electric vans), for “£335” substitute “£345”.

• (14) In paragraph 1N (which defines “pre-electric van” for the purposes of paragraph 1J), for “2003 and” insert “2003 but before 1 January 2007 or on or after 1 January 2009 but”.

• (15) In paragraph 2(1) (rates for motorcycles)—

• (a) in paragraph (a) (engine cylinder capacity not exceeding 150cc etc), for “£25” substitute “£26”,

• (b) in paragraph (b) (motorbicycles with engine cylinder capacity exceeding 150cc but not exceeding 400cc), for “£55” substitute “£57”,

• (c) in paragraph (c) (motorbicycles with engine cylinder capacity exceeding 400cc but not exceeding 600cc), for “£84” substitute “£87”, and

• (d) in paragraph (d) (other cases), for “£117” substitute “£121”.

• (16) In consequence of the amendments made by the preceding provisions of this section, in section 10 of FA 2023, omit subsection (5)(b) and (c).

• (17) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2025.

Rates of vehicle excise duty for rigid goods vehicles without trailers etc

67

• (1) Schedule 1 to VERA 1994 (annual rates of vehicle excise duty) is amended as follows.

• (2) In paragraph 9 (rigid goods vehicles exceeding 3,500 kgs revenue weight), for the table in sub-paragraph (1) substitute—

Revenue weight of vehicle	Revenue weight of vehicle	Rate	Rate	Rate
(1)	(2)	(3)	(4)	(5)
Exceeding	Not exceeding	Two axle vehicle	Three axle vehicle	Four or more axle vehicle
kgs	kgs	£	£	£
3,500	7,500	171	171	171
7,500	11,999	207	207	207
11,999	14,000	98	98	98
14,000	15,000	109	98	98
15,000	19,000	311	98	98
19,000	21,000	311	130	98
21,000	23,000	311	218	98
23,000	25,000	311	311	218
25,000	27,000	311	311	311
27,000	44,000	311	311	580

• (3) In paragraph 11(1) (tractive units), for Table 1 and Table 2 substitute—

Revenue weight of vehicle	Revenue weight of vehicle	Rate	Rate	Rate
(1)	(2)	(3)	(4)	(5)
Exceeding	Not exceeding	Any no of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles
kgs	kgs	£	£	£
3,500	11,999	171	171	171
11,999	22,000	83	83	83
22,000	23,000	87	83	83
23,000	25,000	157	83	83
25,000	26,000	275	104	83
26,000	28,000	275	151	83
28,000	31,000	311	311	83
31,000	33,000	580	580	218
33,000	34,000	580	631	218
34,000	38,000	715	715	580
38,000	44,000	881	881	881
Revenue weight of vehicle	Revenue weight of vehicle	Rate	Rate	Rate
---	---	---	---	---
(1)	(2)	(3)	(4)	(5)
Exceeding	Not exceeding	Any no of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles
kgs	kgs	£	£	£
3,500	11,999	171	171	171
11,999	25,000	83	83	83
25,000	26,000	104	83	83
26,000	28,000	151	83	83
28,000	29,000	218	83	83
29,000	31,000	300	83	83
31,000	33,000	580	218	83
33,000	34,000	631	311	83
34,000	36,000	631	311	218
36,000	38,000	715	580	311
38,000	44,000	881	881	580

• (4) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2025.

Rates of vehicle excise duty for rigid goods vehicles with trailers

68

• (1) In paragraph 10 of Schedule 1 to VERA 1994 (supplement to annual rate of duty for rigid goods vehicles with trailers), in sub-paragraph (6), for the Tables 1 to 6 substitute—

Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	12,000	-	27,000	238
B(T)	12,000	-	-	33,000	306
B(T)	12,000	-	33,000	36,000	416
B(T)	12,000	-	36,000	38,000	331
B(T)	12,000	-	38,000	-	460
D(T)	4,000	12,000	-	30,000	378
D(T)	12,000	-	-	38,000	446
D(T)	12,000	-	38,000	-	460
Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
---	---	---	---	---	---
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	12,000	-	33,000	238
B(T)	12,000	-	-	38,000	306
B(T)	12,000	-	38,000	40,000	406
B(T)	12,000	-	40,000	-	306
C(T)	4,000	12,000	-	35,000	316
C(T)	12,000	-	-	38,000	383
C(T)	12,000	-	38,000	40,000	406
C(T)	12,000	-	40,000	-	383
D(T)	4,000	10,000	-	33,000	378
D(T)	4,000	10,000	33,000	36,000	416
D(T)	10,000	12,000	-	38,000	378
D(T)	12,000	-	-	-	446
Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
---	---	---	---	---	---
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	12,000	-	35,000	238
B(T)	12,000	-	-	-	306
C(T)	4,000	12,000	-	37,000	316
C(T)	12,000	-	-	-	383
D(T)	4,000	12,000	-	39,000	378
D(T)	12,000	-	-	-	446
E(T)	4,000	12,000	-	-	555
E(T)	12,000	-	-	-	622
Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
---	---	---	---	---	---
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	12,000	-	27,000	238
B(T)	12,000	-	-	31,000	306
B(T)	12,000	-	31,000	33,000	416
B(T)	12,000	-	33,000	36,000	631
B(T)	12,000	-	36,000	38,000	460
B(T)	12,000	-	38,000	-	626
D(T)	4,000	12,000	-	30,000	378
D(T)	12,000	-	-	33,000	446
D(T)	12,000	-	33,000	36,000	631
D(T)	12,000	-	36,000	38,000	460
D(T)	12,000	-	38,000	-	626
Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
---	---	---	---	---	---
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	10,000	-	29,000	238
B(T)	4,000	10,000	29,000	31,000	300
B(T)	10,000	12,000	-	33,000	238
B(T)	12,000	-	-	36,000	306
B(T)	12,000	-	36,000	38,000	406
B(T)	12,000	-	38,000	-	562
C(T)	4,000	10,000	-	31,000	316
C(T)	4,000	10,000	31,000	33,000	416
C(T)	10,000	12,000	-	35,000	316
C(T)	12,000	-	-	36,000	383
C(T)	12,000	-	36,000	38,000	406
C(T)	12,000	-	38,000	-	562
D(T)	4,000	10,000	-	31,000	378
D(T)	4,000	10,000	31,000	33,000	416
D(T)	4,000	10,000	33,000	35,000	631
D(T)	10,000	12,000	-	36,000	378
D(T)	10,000	12,000	36,000	37,000	406
D(T)	12,000	-	-	38,000	446
D(T)	12,000	-	38,000	-	562
Vehicle excise duty band	Plated gross weight of trailer	Plated gross weight of trailer	Total weight	Total weight	Rate
---	---	---	---	---	---
(1)	(2)	(3)	(4)	(5)	(6)
	Exceeding (kgs)	Not exceeding (kgs)	Exceeding (kgs)	Not exceeding (kgs)	£
B(T)	4,000	12,000	-	35,000	238
B(T)	12,000	-	-	-	306
C(T)	4,000	12,000	-	37,000	316
C(T)	12,000	-	-	-	383
D(T)	4,000	10,000	-	36,000	378
D(T)	4,000	10,000	36,000	37,000	460
D(T)	10,000	12,000	-	39,000	378
D(T)	12,000	-	-	-	446
E(T)	4,000	10,000	-	38,000	555
E(T)	4,000	10,000	38,000	-	626
E(T)	10,000	12,000	-	-	555

• (2) In that paragraph, in sub-paragraph (7), for “£609” substitute “£631”.

• (3) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2025.

Vehicle excise duty for vehicles with exceptional loads etc

69

• (1) In—

• (a) paragraph 6(2A)(a) of Schedule 1 to VERA 1994 (vehicles with exceptional loads),

• (b) paragraph 9(3) of that Schedule (rigid goods vehicle which has weight exceeding 44,000 kg and is not an island goods vehicle), and

• (c) paragraph 11(3) of that Schedule (tractive unit vehicle which has weight exceeding 44,000 kg and is not an island goods vehicle),

for “£1,585” substitute “£1,643”.

• (2) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2025.

Rate of vehicle excise duty for haulage vehicles other than showman’s vehicles

70

• (1) In paragraph 7(3A) of Schedule 1 to VERA 1994 (which specifies the rate of vehicle excise duty applicable to haulage vehicles other than showman’s vehicles), for “£350” substitute “£365”.

• (2) The amendment made by this section has effect in relation to licences taken out on or after 1 April 2025.

Vehicle excise duty: zero-emission vehicles

71

• (1) VERA 1994 is amended as follows.

• (2) In section 62 (other definitions), after subsection (1A) insert—

(1AA) For the purposes of this Act, a vehicle is a “zero-emission vehicle” if the vehicle’s rate of CO₂ emissions measured in grams per kilometre driven, or grams per kilowatt hour, is zero.

• (3) In Schedule 1 (annual rates of duty)—

• (a) in paragraph 1—

• (i) in sub-paragraph (2), after “propelled” insert “, or zero-emission,”;

• (ii) in sub-paragraph (2A), after “propelled” insert “, or zero-emission,”;

• (b) in paragraph 1A (vehicles to which Part 1A applies), after sub-paragraph (1) insert—

(1A) Sub-paragraph (1B) has effect where— (a) the vehicle’s rate of CO₂ emissions in grams per kilometre driven is zero, (b) the certificate mentioned in sub-paragraph (1)(b) does not specify a CO₂ emissions figure, and (c) this Part of this Schedule would apply to the vehicle if the condition in sub-paragraph (1)(b)(ii) were met. (1B) For the purposes of this Part of this Schedule— (a) the certificate is regarded as specifying a CO₂ figure of zero in terms of grams per kilometre driven, and (b) accordingly the applicable CO₂ emissions figure is to be taken to be zero.

• (c) in paragraph 1GA (vehicles to which Part 1AA applies), after sub-paragraph (1A) insert—

(1B) Sub-paragraph (1C) has effect where— (a) the vehicle’s rate of CO₂ emissions in grams per kilometre driven is zero, (b) the certificate mentioned in sub-paragraph (1)(b) does not specify a CO₂ emissions figure, and (c) this Part of this Schedule would apply to the vehicle if the condition in sub-paragraph (1)(b)(ii) were met. (1C) For the purposes of this Part of this Schedule (and notwithstanding anything in sub-paragraph (5))— (a) the certificate is regarded as specifying a CO₂ figure of zero in terms of grams per kilometre driven, and (b) accordingly the applicable CO₂ emissions figure is to be taken to be zero.

• (d) in paragraph 1N, in sub-paragraph (b), at the end insert “or a zero-emission vehicle”;

• (e) in paragraph 2 (motorcycles)—

• (i) in sub-paragraph (1)(a), after “propelled” insert “or a zero-emission vehicle”;

• (ii) in sub-paragraph (3), in the definition of “motorcycle”, after “propelled” insert “, or zero-emission,”.

• (4) In Schedule 2 (exempt vehicles)—

• (a) in the italic heading before paragraph 20G, at the end insert “etc”;

• (b) in paragraph 20G (electrically propelled vehicles), after sub-paragraph (1) insert—

(1A) A zero-emission vehicle is an exempt vehicle.

• (5) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2025.

Rates of HGV road user levy

72

• (1) Schedule 1 to the HGV Road User Levy Act 2013 (rates of the levy) is amended as follows.

• (2) In paragraph 5, for Table 1 substitute—

Band	Daily rate	Weekly rate	Monthly rate	Half-yearly rate	Yearly rate
A	£3.10	£7.75	£15.50	£93	£155
B	£7.46	£18.65	£37.30	£223.80	£373
C	£9.33	£29.85	£59.70	£358.20	£597

.

• (3) In paragraph 5, for Table 1A substitute—

Band	Daily rate	Weekly rate	Monthly rate	Half-yearly rate	Yearly rate
A	£4.04	£10.10	£20.20	£121.20	£202
B	£9.70	£24.25	£48.50	£291	£485
C	£10.36	£38.80	£77.60	£465.60	£776

.

• (4) In consequence of the provision made by subsections (2) and (3), in the Heavy Goods Vehicles (Charging for Use of Certain Infrastructure on the Trans-European Road Network) Regulations 2009, omit regulations 2(2)(d)(i) and 9.

• (5) The amendments made by this section come into force on 1 April 2025.

Rates of air passenger duty until 1 April 2026

73

• (1) Section 30 of FA 1994 (air passenger duty: rates) is amended as follows.

• (2) In subsection (2) (short-haul journeys), in paragraph (b), for “£26” substitute “£28”.

• (3) In subsection (2A) (long-haul journeys)—

• (a) in paragraph (a), for “£88” substitute “£90”, and

• (b) in paragraph (b), for “£194” substitute “£216”.

• (4) In subsection (4A) (ultra-long haul journeys)—

• (a) in paragraph (a), for “£92” substitute “£94”, and

• (b) in paragraph (b), for “£202” substitute “£224”.

• (5) In subsection (4E) (journeys on aircraft equipped to carry fewer than 19 passengers)—

• (a) in paragraph (za), for “£78” substitute “£84”,

• (b) in paragraph (a), for “£78” substitute “£84”,

• (c) in paragraph (aa), for “£581” substitute “£647”, and

• (d) in paragraph (d), for “£607” substitute “£673”.

• (6) The amendments made by this section have effect in relation to the carriage of passengers beginning on or after 1 April 2025 but before 1 April 2026.

Rates of air passenger duty from 1 April 2026

74

• (1) Section 30 of FA 1994 (air passenger duty: rates), as amended by section 73 above, is amended as follows.

• (2) In subsection (1B) (journeys ending in the United Kingdom)—

• (a) in paragraph (a), for “£7” substitute “£8”, and

• (b) in paragraph (b), for “£14” substitute “£16”.

• (3) In subsection (2) (short-haul journeys)—

• (a) in paragraph (a), for “£13” substitute “£15”, and

• (b) in paragraph (b), for “£28” substitute “£32”.

• (4) In subsection (2A) (long-haul journeys)—

• (a) in paragraph (a), for “£90” substitute “£102”, and

• (b) in paragraph (b), for “£216” substitute “£244”.

• (5) In subsection (4A) (ultra-long haul journeys)—

• (a) in paragraph (a), for “£94” substitute “£106”, and

• (b) in paragraph (b), for “£224” substitute “£253”.

• (6) In subsection (4E) (journeys on aircraft equipped to carry fewer than 19 passengers)—

• (a) in paragraph (za), for “£84” substitute “£142”,

• (b) in paragraph (a), for “£84” substitute “£142”,

• (c) in paragraph (aa), for “£647” substitute “£1,097”, and

• (d) in paragraph (d), for “£673” substitute “£1,141”.

• (7) The amendments made by this section have effect in relation to the carriage of passengers beginning on or after 1 April 2026.

Environmental taxes

Rates of climate change levy

75

• (1) In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount payable by way of levy), for the table substitute—

Taxable commodity supplied	Rate at which levy payable if supply is not a reduced-rate supply
Electricity	£0.00801 per kilowatt hour
Gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility	£0.00801 per kilowatt hour
Any petroleum gas, or other gaseous hydrocarbon, supplied in a liquid state	£0.02175 per kilogram
Any other taxable commodity	£0.06264 per kilogram

.

• (2) The amendment made by this section has effect in relation to supplies treated as taking place on or after 1 April 2026.

Rates of landfill tax

76

• (1) Section 42 of FA 1996 (amount of landfill tax) is amended as follows.

• (2) In subsection (1)(a) (standard rate), for “£103.70” substitute “£126.15”.

• (3) In subsection (2) (reduced rate for certain disposals), in the words after paragraph (b)—

• (a) for “£103.70” substitute “£126.15”, and

• (b) for “£3.30” substitute “£4.05”.

• (4) The amendments made by this section have effect in relation to disposals made (or treated as made) on or after 1 April 2025.

Rate of aggregates levy

77

• (1) In section 16(4) of FA 2001 (rate of aggregates levy), for “£2.03” substitute “£2.08”.

• (2) The amendment made by this section has effect in relation to aggregate subjected to commercial exploitation on or after 1 April 2025.

Rate of plastic packaging tax

78

• (1) In section 45(1) of FA 2021 (rate of plastic packaging tax), for “£217.85” substitute “£223.69”.

• (2) The amendment made by this section has effect in relation to packaging components produced in, or imported into, the United Kingdom on or after 1 April 2025.

Soft drinks industry levy

Rates of soft drinks industry levy

79

• (1) In section 36(1) of FA 2017 (rates of soft drinks industry levy)—

• (a) in paragraph (a) (soft drinks that meet higher sugar threshold), for “at the rate of £0.24 per litre” substitute “at the rate of £2.59 per 10 litres”, and

• (b) in paragraph (b) (other soft drinks), for “at the rate of £0.18 per litre” substitute “at the rate of £1.94 per 10 litres”.

• (2) The amendments made by this section have effect in relation to chargeable events occurring on or after 1 April 2025.

Part 4 — Miscellaneous and final

Avoidance

Limited liability partnerships

80

• (1) After section 59A of TCGA 1992 (limited liability partnerships) insert—

(59AA) (1) This section applies where— (a) a member of a limited liability partnership (the “LLP”) contributed an asset to the LLP in circumstances where section 59A(1) applied in relation to the LLP, and (b) the LLP disposes of the asset, or part of the asset, to the member, or a person connected with the member, in circumstances where section 59A(1) has ceased to apply in relation to the LLP. (2) The asset is deemed to have been disposed of and reacquired by the member— (a) immediately before it was contributed to the LLP, and (b) for a consideration equal to its market value at that time. (3) But— (a) any chargeable gain or allowable loss accruing under subsection (2) is to be treated as accruing at the time the asset, or part of the asset, is disposed of by the LLP (as described in subsection (1)(b)), and (b) for the purposes of Schedule 2 to the Finance Act 2019 (returns for disposals of UK land), the disposal under subsection (2) is to be treated as completed at that time. (4) Any chargeable gain accruing on the deemed disposal is to be reduced by an amount that is just and reasonable, having regard to any chargeable gain that has otherwise accrued to the member by reference to the asset or part of the asset.

• (2) The amendment made by this section has effect from 30 October 2024, but does not apply where section 59A(1) of TCGA 1992 ceased to apply in relation to the limited liability partnership before that date.

Loans to participators

81

• (1) In CTA 2010, omit section 464B (relief in case of return payment to company).

• (2) The repeal made by subsection (1) has effect in relation to payments made on or after 30 October 2024.

• (3) In consequence of the repeal made by subsection (1), Part 10 of CTA 2010 is amended as follows—

• (a) after section 464 insert—

(464ZA) (1) Where— (a) within any period of 30 days— (i) the qualifying amount of repayments made to a close company in respect of one or more chargeable payments made by the company to a person totals £5,000 or more, and (ii) the available amount of the relevant chargeable payments made by the company to the person or an associate of the person totals £5,000 or more, and (b) the relevant chargeable payments are made in an accounting period subsequent to that in which the chargeable payments mentioned in paragraph (a)(i) were made, the qualifying amount of the repayments, so far as not exceeding the available amount of the relevant chargeable payments, is to be treated for the purposes of this Chapter as a repayment of the relevant chargeable payments. (2) A chargeable payment is a relevant chargeable payment for the purposes of subsection (1) if (or to the extent that) it is not repaid within the period of 30 days mentioned in that subsection. (3) Where— (a) immediately before a repayment is made in respect of one or more chargeable payments made by a close company to a person, the total amount owed to the company by the person in respect of chargeable payments is £15,000 or more, (b) at the time the repayment is made, arrangements had been made for one or more chargeable payments to be made to replace some or all of the amount repaid, and (c) the available amount of the chargeable payments made by the company to the person or an associate of the person under the arrangements totals £5,000 or more, the qualifying amount of the repayment, so far as not exceeding the available amount of the chargeable payments mentioned in paragraph (c), is to be treated for the purposes of this Chapter as a repayment of those chargeable payments. (4) An amount contained in a chargeable payment is an available amount— (a) for the purposes of subsection (1), to the extent that no repayment has been treated as made in respect of it by the previous operation of that subsection, and (b) for the purposes of subsection (3), to the extent that no repayment has been treated as made in respect of it— (i) by the operation of subsection (1), or (ii) by the previous operation of subsection (3). (5) An amount contained in a repayment is a qualifying amount to the extent that it has not been treated by the previous operation of this section as a repayment of a chargeable payment. (6) This section does not apply in relation to a repayment which gives rise to a charge to income tax on the participator or associate by reference to whom the loan, advance or benefit was a chargeable payment. (7) The Treasury may by order vary a sum specified in subsection (1) or (3). (8) An order under subsection (7) may contain incidental, supplemental, consequential and transitional provision and savings. (464ZB) (1) All such assessments and adjustments of assessments are to be made as are necessary to give effect to section 464ZA(1) and (3). (2) If a person who has made a tax return becomes aware that, after making it, anything in it has become incorrect because of the operation of section 464ZA(1) or (3), the person must give notice to an officer of Revenue and Customs specifying how the return needs to be amended. (3) The notice must be given within 3 months beginning with the day on which the person became aware that anything in the return had become incorrect because of the operation of section 464ZA(1) or (3). (4) In section 464ZA, “chargeable payment” means a loan or advance made by a close company which gives rise to a charge to tax under section 455.

,

• (b) omit Chapter 3B (which contained only provisions that are replaced by those inserted by paragraph (a)),

• (c) in section 438, (overview of Part 10) omit subsection (2B), and

• (d) in section 459(2) (loan treated as made to participator), for “464C and 464D” substitute “464ZA and 464ZB”.

• (4) The amendments made by subsection (3) are treated as having come into force on 30 October 2024.

Crytpo-asset reporting framework

OECD crypto-asset reporting framework

82

In section 349(2) of F(No.2)A 2023 (international arrangements for exchanging information)—

• (a) after paragraph (f) insert—

(fa) the OECD Crypto-Asset Reporting Framework, published in 2022;

, and

• (b) in paragraph (g), for “(f)” substitute “(fa)”.

Preparing for new taxes and information sharing

Duty on vaping products

83

The Commissioners for His Majesty’s Revenue and Customs may prepare for the introduction of a new duty to be charged in respect of vaping products.

Carbon border adjustment mechanism

84

• (1) The Commissioners for His Majesty’s Revenue and Customs may prepare for the introduction of a new tax to be charged in respect of emissions embodied in imported goods.

• (2) The Treasury or the Commissioners for His Majesty’s Revenue and Customs may request in writing information from the UK ETS authority or a national authority for any purpose connected with the tax.

• (3) If a request is made to an authority under subsection (2), the authority must provide the requested information if the authority holds it.

• (4) Subsection (3) does not require the disclosure of personal data (within the meaning of section 3(2) of the Data Protection Act 2018).

• (5) In this section—

• “national authority” has the meaning given by section 95 of the Climate Change Act 2008;

• “UK ETS authority” has the meaning given by Article 14 of the Greenhouse Gas Emissions Trading Scheme Order 2020 (S.I. 2020/1265).

Wrong cross-reference etc

Correction of wrong cross-reference etc

85

• (1) In section 151I(1) of TCGA 1992, for paragraph (d) substitute—

(d) a person with permission under Part 4A of the Financial Services and Markets Act 2000 to enter into, or to exercise or have the right to exercise rights and duties under, a contract of the kind mentioned in paragraph 23 or paragraph 23B of Schedule 2 to that Act (credit agreements and contracts for hire of goods);

.

• (2) In section 1179AE(2) of CTA 2009, for “either House of Parliament” substitute “the House of Commons”.

• (3) In section 4(2)(a) of the Taxation (Post-transition Period) Act 2020, for “section 42” substitute “section 47”.

Final

Interpretation

86

In this Act the following abbreviations are references to the following Acts—

CAA 2001	Capital Allowances Act 2001
CTA 2009	Corporation Tax Act 2009
CTA 2010	Corporation Tax Act 2010
FA followed by a year	Finance Act of that year
F(No.2)A followed by a year	Finance (No.2) Act of that year
IHTA 1984	Inheritance Tax Act 1984
ITA 2007	Income Tax Act 2007
ITEPA 2003	Income Tax (Earnings and Pensions) Act 2003
ITTOIA 2005	Income Tax (Trading and Other Income) Act 2005
TCGA 1992	Taxation of Chargeable Gains Act 1992
TIOPA 2010	Taxation (International and Other Provisions) Act 2010
TMA 1970	Taxes Management Act 1970
TPDA 1979	Tobacco Products Duty Act 1979
VATA 1994	Value Added Tax Act 1994
VERA 1994	Vehicle Excise and Registration Act 1994

Short title

87

This Act may be cited as the Finance Act 2025.

Schedule 1

Amendments of TCGA 1992

1

TCGA 1992 is amended as follows.

2

In section 1I (income taxed at higher rates or gains exceeding unused basic rate band)—

• (a) in subsection (1)—

• (i) omit paragraph (za), and

• (ii) in paragraph (b), for “20%” substitute “24%”,

• (b) in subsection (2), in the closing words—

• (i) omit “at the rate of 24% (so far as comprising residential property gains),”, and

• (ii) for “20%” substitute “24%”,

• (c) in subsection (5)—

• (i) omit paragraph (za), and

• (ii) in paragraph (b), for “20%” substitute “24%”, and

• (d) for subsections (7) to (9) substitute—

(7) The individual may allocate so much of the unused part of the individual’s basic rate band as then remains to any carried interest gains or any other gains. (8) The effect of the allocation is that the gains to which the allocation is made are charged at the rate of 18%. (9) Any gains to which no allocation is made are charged— (a) at the rate of 28% (if they are carried interest gains), or (b) at the rate of 24% (if they are other kinds of gains).

3

In section 222A (determination of main residence: non-resident CGT disposals), in subsection (1)(b)(i), for “a residential property gain (as defined by Schedule 1B)” substitute “a gain”.

4

In section 223 (amount of relief), in subsection (7)(b), for “a residential property gain (as defined by Schedule 1B)” substitute “a gain”.

5

Omit Schedule 1B (residential property gains).

6

• (1) Schedule 4AA (re-basing for non-residents in respect of UK land etc held on 5 April 2019) is amended as follows.

• (2) Omit paragraphs 5, 10, 11 and 15.

• (3) In paragraph 22(3), for “Schedule 1B” substitute “paragraphs 16E to 16H of Schedule 2 to the Finance Act 2019”.

Amendments of other Acts

7

In paragraph 8(3) of Schedule A1 to IHTA 1984 (non-excluded overseas property), for “Schedule 1B to the 1992 Act” substitute “paragraphs 16B to 16H of Schedule 2 to the Finance Act 2019”.

8

In Schedule 1 to FA 2019, omit paragraph 15.

9

• (1) Schedule 2 to that Act (returns and payments on account: disposals of UK land etc) is amended as follows.

• (2) After paragraph 16 insert—