Little on offer for independent garages

BUDGET 2025: Chancellor has not recognised impact of rising costs and tightening margins, says Jonathan Douglass of the Independent Garage Association

The Independent Garage Association (IGA) has reviewed the measures announced in today’s Autumn Budget by the chancellor, Rachel Reeves. 

While the decision to fully fund apprenticeships for under-25s in small and medium-sized enterprises (SMEs) is a welcome and positive step, much of the remaining Budget provides limited reassurance for independent garages across the sector.

Beyond the apprenticeship announcement, the Budget offers little meaningful support for SMEs. Independent garages continue to face rising costs, tightening margins and increasing regulatory complexity, yet today’s measures do not deliver the assistance or relief they urgently need.

Questions also persist around electric vehicle (EV) policy. Although the government has committed further investment to support EV infrastructure and adoption, the introduction of EV “pay-per-mile” taxation represents a clear setback, undermining consumer confidence and creating additional uncertainty for businesses preparing for an electric future. Clear, consistent policy is essential, yet today’s message remains mixed.

The announced 2% increase in tax for landlords’ dividends and savings represents an additional financial strain, both for garage businesses that rent their premises and for owners who pay dividends to themselves. These changes add to wider cost pressures at a time when many independent garages are already working hard to maintain stable cashflow in unpredictable trading conditions.

The rise in the National Minimum Wage may not directly affect every independent garage, however, it will have a knock-on effect across staffing costs, supply chains and associated costs, adding further pressure to businesses already contending with higher energy bills, equipment costs and insurance premiums.

While the commitment to making under-25 apprenticeships free for SMEs is a step in the right direction, the rest of the Budget feels ambiguous and offers little real-world support for independent garages. 

The negative impact of EV pay-per-mile proposals, rising operational costs and higher taxes on savings and dividends create yet more challenges. The government must commit to clearer, more supportive measures.

Ongoing examination of the Budget is underway to assess its full impact on independent garages.

The IGA will continue to work with government to advocate for practical, targeted policies that recognise the vital contribution of independent garages to the UK’s automotive ecosystem and ensure businesses have the stability needed to invest, grow and serve their communities.

Jonathan Douglass is director of the Independent Garages Associaion (IGA)