Tensions have been rising in the UK in recent weeks as speculation grows about what will be included in the Autumn Budget. Reports that Chancellor Rachel Reeves was considering breaking the Labour Party’s election pledge not to raise income taxes caused widespread concern. However, government sources later told the Financial Times that Reeves had decided against this move after receiving more positive economic forecasts than expected.
Despite this, other tax changes—such as higher rates and reduced reliefs—are still expected when Reeves presents her budget on November 26. These measures are part of Labour’s effort to address the estimated £20 billion gap in the UK’s public finances.
For the British fashion industry, the budget arrives at a critical time. The sector is facing intense cost pressures, low business confidence, and growing global competition. Brands are already dealing with rising taxes, including higher employer National Insurance contributions, and they worry that further increases could lead to higher prices, squeeze already tight profit margins, or delay hiring and investment.
Uncertainty around business rates reform also poses a threat to both independent retailers and large flagship stores. There is additional concern that investment in key areas—such as manufacturing, UK-based infrastructure, and sustainability innovation—may be sidelined if the budget prioritizes fiscal tightening over industrial strategy.
One of the most urgent issues is the UK’s declining international competitiveness, especially since Brexit. Export-focused fashion businesses continue to face trade barriers, tariffs, and limited government support for international growth. The removal of VAT-free shopping is frequently mentioned as a major factor hurting tourism, luxury spending, and the UK’s overall appeal.
With business confidence low and companies navigating a volatile global market, decisions on tax, trade, and industrial support will play a crucial role in determining whether British fashion can remain competitive both domestically and internationally.
Here’s what industry leaders are hoping to see in the 2025 Autumn Budget:
Laura Weir, CEO of the British Fashion Council (BFC)
British fashion is a cultural force and a major economic contributor, but it continues to face significant challenges following Brexit and the pandemic. The BFC appreciates the government’s funding commitments outlined earlier this year in the Creative Industries Sector Plan. However, businesses are still struggling, and the budget presents an opportunity for the government to further support growth, opportunity, and employment in this vital £67.5 billion sector.
The BFC has called on the chancellor to introduce measures that lower costs and create opportunities for British businesses. These include a VAT Retail Export Scheme to encourage international spending in the UK, reduced business rates for retail and creative businesses, increased export promotion funding for the fashion sector, and investment in creative skills and education.
Joshua Schulman, CEO of Burberry
We take great pride in our British heritage and are proud to be a major employer in the UK, with our facilities in London, our store network, and our manufacturing site in Yorkshire.
From our perspective, we urge the government to focus on enhancing international competitiveness and attracting global customers to the UK. We believe the government can take proactive steps to reestablish London as Europe’s top shopping destination. We would like to see forward-thinking policies that revive international visitor spending, support jobs, and stimulate growth across the entire visitor economy.One of the most important changes needed in our world is to reform the VAT refund scheme and bring it in line with European countries. Since the VAT refund was removed, tourism in London has declined. This presents a significant opportunity for government and businesses to work together proactively and boost growth in the UK.
Adam Mansell, CEO of the UK Fashion and Textiles Association (UKFT), states that their top priority is implementing a textile-specific extended producer responsibility (EPR) scheme. Their pilot work shows that a smart, data-driven EPR system is achievable and could generate up to £1 billion annually to promote true circularity, especially closed-loop recycling, which is the industry’s ultimate goal. UK businesses across the supply chain support this, and with the EU moving toward mandatory textile EPR, the UK must not fall behind.
They also advocate for the return of VAT-free shopping to increase tourist spending and support UK manufacturers supplying luxury brands. On exports, they call for the reinstatement of the Tradeshow Access Program and stronger embassy support, as it was a low-cost initiative that provided a £1:£40 return and helped companies of all sizes enter new markets.
To protect domestic capabilities, they urge the government to adopt UK-focused public procurement rules, particularly for technical textiles. This would ensure a more secure supply for critical products in defense, aerospace, and health sectors, while safeguarding and creating thousands of jobs and encouraging long-term investment.
Additionally, they recommend closing the de minimis loophole on low-value direct-to-consumer imports that don’t meet UK standards; expanding innovation funding with clearer R&D tax credit rules and full support for SMEs; addressing rising employment costs; keeping childrenswear VAT-free; and making the Apprenticeship Levy more flexible so businesses can invest in the skills and creativity the industry needs.
Helen Brocklebank, CEO of Walpole, outlines five priorities for the Autumn Budget. First, they urge a measured approach to business rates reform. Large venues like hotels, department stores, and flagship retailers serve as anchor assets on high streets, attracting high-spending visitors who also support smaller cafes, restaurants, and boutiques. The government’s plan to impose extra business rates on properties valued over £500,000 is concerning, as it will directly affect flagship boutiques and high-end hotels and have broader business impacts. They call on the chancellor to exempt all retail, hospitality, and leisure businesses from this additional burden.
Second, Walpole advocates for extending full expensing to secondhand plant and machinery. Many British luxury manufacturers use heritage equipment, often bought refurbished, and this investment is currently excluded from capital allowances, unfairly penalizing smaller and sustainability-focused makers.
Third, they seek a competitive tax environment, including a modern visitor incentive scheme for international tourists. Without this, the UK remains at a disadvantage compared to France, Italy, and Spain, where tourists can reclaim VAT. Additionally, freezing alcohol duty and introducing cellar door relief would help the luxury wines and spirits industry thrive.
Fourth, the Growth and Skills Levy should better support creative and craft skills. Luxury businesses train specialist makers, designers, and hospitality professionals, but the current system lacks the flexibility needed.Businesses need greater flexibility in how they use levy funds to expand high-quality skills and create new career pathways.
Small exporters urgently require support to navigate complex EU and global sustainability regulations. With around 70% of products sold overseas, clear guidance and compliance assistance are crucial for growth.
Helen Brocklebank, CEO of Walpole, emphasizes these points.
Tamara Cincik, founder of Fashion Roundtable, highlights that the government is addressing financial gaps without considering Brexit and Covid impacts. Tariffs on trade with the EU, our largest partner, are significant and need attention. Revitalizing this relationship could start with a Youth Mobility Scheme to ease movement for young people between the UK and EU.
The luxury sector is suffering from the end of tax-free shopping, diverting sales to Paris and Milan and affecting travel and hospitality. Raising National Insurance, business rates, and taxes would hinder growth rather than spur investment. Many businesses are struggling with a slow economy and repaying Covid-era debts amid high inflation.
The UK’s growing sustainable fashion sector deserves incentives, similar to those for film and theatre, to encourage local manufacturing. This would lower costs for producers and retailers, allowing them to highlight their British origins and build consumer loyalty. Tax breaks for heritage brands to return production to the UK and local government support for pop-up shops in vacant retail spaces could boost regeneration.
UK-made public procurement would strengthen manufacturing, stabilize orders, and promote investment, helping manufacturers manage cash flow and collaborate with small brands for events like London Fashion Week. Stable orders are key to growth.
Jess McGuire Dudley, managing director of John Smedley, agrees that fair wages are important but criticizes the government for increasing business costs without bringing procurement or manufacturing support back to the UK. This cycle of rising costs and falling volumes threatens jobs. The government should support both workers and industry, for example, by sourcing school or military uniforms from UK textiles, possibly through legislation to ensure fairness.
Ruth Rands, founder of Herd, notes that all their wool products are made in Britain, from Northern English farms to historic mills. This local approach leverages generations of expertise, ensures ethical standards, supports innovation through R&D tax relief, and minimizes unnecessary impacts.Our products travel many miles across the globe. While they are undoubtedly more expensive than overseas alternatives, the superior quality of their finish justifies the cost. We recognize that there are cheaper, lower-quality options available abroad, and our suppliers face constant challenges in competing. This year alone, two of our suppliers have shut down, scattering their valuable skills, top-tier equipment, and expertise worldwide, often to Asia.
The idea of British heritage remains strong, but how much is truly made here? Our globally admired style heritage is a vital cultural and economic export, and its decline would be a loss for everyone involved. Only by supporting and utilizing British manufacturing can we ensure a future as bright as its past.
Frequently Asked Questions
Of course Here is a list of FAQs about British Fashions Budget Hopes designed to be clear concise and helpful for a range of readers
General Beginner Questions
1 What exactly are budget hopes for British fashion
This refers to the specific financial measures and policies that UK fashion brands retailers and industry bodies are asking the government to introduce in its annual budget to help them survive and thrive
2 Why does the fashion industry need help from the governments budget
The industry faces high costs complex international trade postBrexit and competition from fast fashion Support from the budget can help businesses stay competitive create jobs and continue contributing to the UK economy
3 Whats the main thing British fashion is asking for
While requests vary a common hope is for a reduction in business rates and support with high energy costs which are major expenses for both highstreet stores and manufacturers
4 How does helping big fashion brands benefit me as a shopper
Supporting the industry helps protect jobs in the UK encourages the production of higherquality sustainable clothing and ensures a vibrant high street with a variety of shopping options not just empty storefronts
Advanced IndustryFocused Questions
5 What specific tax reforms is the industry lobbying for
Key reforms include permanently lowering business rates increasing the threshold for VAT to help small businesses and introducing tax incentives for companies that invest in sustainable practices and UKbased manufacturing
6 How do Brexitrelated changes factor into these budget hopes
Businesses are hoping for financial support to deal with new customs paperwork tariffs and shipping delays when trading with the EU They may ask for grants or simplified tax procedures to ease the administrative burden
7 Are there hopes tied to sustainability and the circular economy
Yes Many are calling for a green tax on virgin synthetic materials to encourage recycling as well as funding and tax breaks for brands developing repair rental and resale services
8 What about support for emerging designers and fashion graduates
There are hopes for increased funding for arts education startup grants for new fashion businesses and mentorship programs funded by the government to help the next generation of British talent establish themselves
Common Problems Practical Outcomes