Website of the UK government
Please note that this website has a UK government accesskeys system.
Main menu
Page menu
Newsroom
Budget Day guide
The Budget is the Government's annual financial statement and review of levels of taxation. It also includes the Government's future financial strategy and economic forecast. The Chancellor of the Exchequer delivers the Budget speech in the House of Commons.
The Budget speech
The Chancellor’s speech usually has two parts: the first part gives a summary of the economic situation, while the second gives a more detailed account of specific measures the government has or intends to introduce to raise money to finance its spending. It’s usually in this second part that tax changes, such as any changes in income tax or VAT, that affect individuals' income and spending are announced.
The longest continuous Budget speech was by William Gladstone on 18 April 1853, lasting 4 hours and 45 minutes. Benjamin Disraeli's 1867 Budget speech lasted only 45 minutes, about the same time as Gordon Brown’s in 2005.
After the Chancellor's Budget speech, the Leader of the Opposition, rather than the Shadow Chancellor replies. The Chancellor of the Exchequer traditionally makes a Budget Day broadcast to the nation during the evening of Budget Day. The broadcast provides the Chancellor with a further opportunity to outline the intentions and ideas to the public. The Opposition Parties have an opportunity to respond in their own broadcasts during Budget week.
There are usually four or five days of debate on the 'Budget Resolutions' (the basic parts of the Budget that renew annual taxes, such as income tax), covering different policy areas such as health, education and defence. Finally, the Finance Bill makes the tax proposals announced in the Budget into law.
The legislative process - how the Budget goes through Parliament
The re-imposition of annual taxes, such as income tax and corporation tax, and most other tax changes announced in the Budget are legislated in the annual Finance Bill. This is normally published in early January and is considered by Parliament in the Spring, with Royal Assent given by the start of May.
One of the key features of tax legislation, which distinguishes it from any other legislation is that measures announced in the Budget may take effect before the Finance Bill is enacted. The approval of Budget resolutions permits this to take place.
The Budget resolutions are tabled as soon as the Chancellor has finished the Budget speech. Under the Provisional Collection of Taxes Act 1968, these resolutions, once passed by the House of Commons, authorise the imposition of certain taxes or changes in their rates. The Budget resolutions are tabled at the end of the Chancellor's statement and they are voted on at the end of the Budget debate. If passed they can then take effect.
Under the procedures for Budgets the changes on excise duties - taxes on alcohol and petrol for example - often take effect from 6pm on Budget Day, but sometimes a later implementation date is chosen.
Additional links
Access keys
