Last week saw the House of Commons debate the Budget resolutions following which the Finance Bill was published and introduced to the House. Finance (No. 2) Bill 2025/26 had its first reading last week with second reading subsequently scheduled for 16 December 2025. The Bill, as introduced, contains the legislation for a range of announcements in November’s Budget but also features the draft legislation on the changes to agricultural property relief and business property relief from 6 April 2026. Explanatory notes to the Bill are also available. The House of Commons Library has also published a research briefing on the Autumn Budget 2025 and the Finance Bill.
The Finance Bill also includes the primary legislation for the UK’s carbon border adjustment mechanism legislation (CBAM) which will commence from 1 January 2027. More information on the UK’s CBAM is available in a policy update and factsheet.
Finance (No. 2) Bill 2025/26 also includes further amendments to the UK's Pillar Two multinational top-up tax and domestic top-up tax. According to HMRC, these amendments are “those identified from stakeholder consultation or otherwise necessary to ensure the UK’s legislation remains consistent with the commentary and administrative guidance to the GloBE rules developed by the UK and other members of the OECD/G20 Inclusive Framework”. HMRC has also confirmed that the Finance Bill does not include any amendments to reflect any ‘side-by-side package’ as this is still being finalised by the Inclusive Framework. The ‘side by side package’ is a proposed political agreement which would allow the existing Global Intangible Low-Taxed Income Tax regime of the USA to coexist with the OECD's Pillar Two global minimum tax rules. The objective of this arrangement would be to exempt US parented multinational enterprises from some key Pillar Two rules.
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