Budget Meets Backlash UK entrepreneurs give guarded welcome – and sharp warnings – in response to the Autumn Budget

The Chancellor's Autumn Budget has landed with a thud rather than a bang among Britain's entrepreneurial community: welcomed in parts, sharply criticised in others, and widely described as a patchwork of gestures rather than a coherent plan for long-term growth.

Across the UK's tech, investment and scale-up sectors, founders and finance leaders say the Budget reveals a government pulled between fiscal restraint and the desire to keep Britain open for innovation. Several praised targeted measures aimed at startups and investors, but many warned that inconsistent tax policy and the lack of a larger industrial strategy risk undermining the very ambition the government claims to champion.

Martin Jacob, Professor of Accounting and Control at IESE Business School, argues that the Budget's tax changes expose deeper structural issues. "The Chancellor's approach reflects an incoherent strategy. If taxes are to be raised to cut the deficit, that's fine, but it is more effective to use existing taxes than to increase the complexity of the tax system. Raising taxes like this is a highly inefficient way of running the government, and it is very costly for taxpayers. Such compliance costs cut directly into economic growth." His point reflects a frustration shared by many: clarity, not tinkering, is what business wants.

Yet there were glimmers of optimism. Tim Mills, Managing Partner at ACF Investors, said the decision to lift EIS limits could become a genuinely catalytic move for early-stage founders. "The decision to raise EIS limits is a significant step in backing British businesses. This is the most immediate and cost-effective way to encourage risk-taking and innovation, and this decision will hopefully supercharge the momentum of successful, ready-to-scale ventures. This decision has given the government the chance to translate its positive rhetoric around entrepreneurship into tangible support for growth."

For some, though, the Budget also missed a chance to restore confidence in long-disputed policies. Duncan Johnson, CEO of Northern Gritstone, lamented the direction of capital gains relief for founders. "Entrepreneurs' Relief was the best tax regime I've seen implemented by a Labour Government. It supported the innovation economy, and the benefits were capped at a sensible level. With constant changes since it was first introduced, the scheme is no longer fit for purpose, and I would have liked to see the policy reset today, so it can go back to what it was meant to do: help and encourage entrepreneurs."

Tech leaders, meanwhile, zoomed out to look at the UK's global competitive position. Tanya Suarez, CEO of IoT Tribe, welcomed the government's major AI commitments but warned of a widening gap between aspiration and investment. "The Government's AI investment plan announced earlier this week, including a £500m Sovereign AI Unit and another £100m to buy domestic AI hardware, is a strong commitment to the UK's technology ecosystem. However, we're seeing more and more UK firms head to the US to seek deeper pools of funding or to be acquired. If the UK is to achieve sustained economic growth, we must find the cash to invest in the technologies in which the UK excels. This is not a niche opportunity but a critical path to growth and key to reinvigorating a UK-wide industrial base. It is vital to strengthen our technology sovereignty when national security and supply chain resilience are paramount as well. To reaffirm its commitment to being a world leader in science and technology, the UK must align these public investment commitments with incentives for private investors to support later-stage AI and quantum startups. Although the Chancellor made important changes around the Enterprise Investment Scheme (EIS) and signalled her intent to keep the UK's most promising scaleups on these shores, we need to see further action to really shift the dial."

Others focused on the growing competitiveness problem: the number of entrepreneurs choosing to leave. Stuart Mellis, CFO of Optalysys, called the EMI reforms sensible but insufficient. "If the UK is to remain a great place to start and scale a business, increasing both personal and company EMI limits is a sensible move. The government, however, needs to also revisit the threshold for Business Asset Disposal Relief and extend it. The UK cannot ignore the growing number of entrepreneurs choosing to leave the UK. A combination of increasing EMI limits, simplifying share option scheme administration and tailoring CGT rates for scale-up teams are essential to encourage UK-based entrepreneurs to stay in the UK and build world-leading companies here."

From a legal standpoint, concerns remain about changes to employee ownership structures. John Dunlop, Head of Tax at Marriott Harrison, warned that some reforms cut against the pro-startup narrative. "The proposed reduction in EOT tax relief is a disappointment, especially when the chancellor has clearly listened to business leaders and announced supportive policies, such as the expansion of the EMI scheme and re-engineering the likes of the EIS. EOTs represent a crucial exit strategy for business owners seeking a smooth transition."

Across the board, one theme is clear: founders and investors see potential in the Budget's scattered pro-innovation measures, but still fear the UK is losing ground to global competitors. Many wanted a bolder, more confident industrial strategy; instead, they got a mix of incentives, reversals and exceptions that gesture toward ambition without fully committing to it.

For a government promising to make Britain "the best place to start and grow a business", entrepreneurs appear to be listening - but not yet convinced.