KPMG warns UK 'elevated taxes' set to hit later this year

The UK Government faces tough tax choices in the years ahead with mounting public spending pressures versus sluggish economic growth, according to new forecasts.

Economists for KPMG said it had been an unexpectedly strong start to 2025 but the second half was looking more uncertain.

The accountancy giant is forecasting UK gross domestic product (GDP) to rise by 1.2% over 2025 and 1.1% in 2026.

Consumers are expected to remain cautious in relation to spending while uncertainty about trade policy continues to pose a risk to levels of business investment, according to its latest UK Economic Outlook report.

“While the economy showed resilience at the start of the year, the second half looks more uncertain,” Yael Selfin, KPMG UK’s c

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