Following the Budget from the Chancellor of the Exchequer, the Advertising Association has issued the below comment.
Konrad Shek, Public Policy and Regulation Director at the Advertising Association said:
“We welcome the Chancellor’s Budget and its aim of giving breathing space to households and businesses at a time of real pressure. Help with energy costs, support for the high street through business rates relief, and the commitment to fiscal discipline will all help create the stability businesses need to invest, including in the marketing that drives demand and growth. We also welcome plans to devolve fiscal powers, which have the potential to drive growth at a regional level.
However, we are concerned that one measure in the Budget could quietly raise costs for the UK’s smallest businesses. From April 2027, overseas providers will have to charge VAT on services sold to UK businesses that are not VAT-registered. This could affect sole traders and micro-businesses who rely on online advertising to reach customers but cannot reclaim VAT. We will be seeking urgent clarity from HM Treasury and HMRC.
We also welcome the opportunity to engage on plans to reform non-compete clauses. Our industry depends on talent moving freely, but agencies must also be able to protect client relationships and intellectual property. It is disappointing that the creative industries, including advertising, received little attention in this Budget. We look forward to working with government on these reforms, and on making sure the contribution of advertising and the wider creative industries is properly recognised by policymakers.”
