Autumn Budget 2026 measures in current law

changelog.d/ab26-carers-allowance-taper.changed.md

@@ -0,0 +1 @@
+Replace the cliff edge at the Carer's Allowance earnings limit with the 100% taper that Budget 2026 announced, in England and Wales: the weekly allowance falls by £1 for each £1 of weekly earnings above the limit. The taper starts within 2030-31; until DWP confirms the date the model starts it on 6 October 2030, so 2030-31 carries 182 of its 365 days. In that year the weeks before the taper and the weeks under it each get their own couple restriction and overlapping-benefit reduction, so State Pension reduces the allowance only in the weeks the allowance pays for. A couple caring for the same person elect which of them has the allowance, and the model gives it to the partner with the larger award (before, it preferred the benefit-unit head), so the taper never leaves a couple with less than the cliff edge did, and one partner has the award for the year: where the two have the same award for some weeks, the couple elect the one with the larger award over the year. An amount before the couple restriction or the overlap rule that an input supplies, or that a reform neutralizes, calculates with a formula of its own or otherwise changes, reaches the payment with the whole year's treatment for the stages after it, even where it equals the model's. The payment ignores the stage before the couple restriction wherever an input supplies, or a reform calculates, the amount before overlap. A mask that takes away a fraction of a penny counts as a change, since the couple restriction chooses only among partners with an award. A payment of less than half a penny for the year is nil.

changelog.d/ab26-electricity-vat.changed.md

@@ -0,0 +1 @@
+Extend the temporary zero rate of VAT on domestic electricity to 30 June 2027, and apply it in Northern Ireland from 1 April 2027, as announced at Budget 2026.

changelog.d/ab26-fuel-duty.changed.md

@@ -0,0 +1 @@
+Keep the 5p fuel duty cut, and the proportionate cut for LPG and natural gas, to 1 July 2027, as announced at Budget 2026. On that date petrol and diesel rise to the OBR's forecast of 60.59p (57.95p uprated by RPI growth to 2027 Q1), and LPG and natural gas return to their full rates with the same uprating, at the rates HM Treasury publishes (natural gas 25.82p a kilogram); all three then rise by RPI each 1 April from 2028.

changelog.d/ab26-household-energy-payment.added.md

@@ -0,0 +1 @@
+Add the Household Energy Payment announced at Budget 2026: £100 in 2026-27 for households in council tax bands A to D in England, counted in household benefits, government spending and HBAI income (as HBAI counted the 2022 Council Tax Rebate).

changelog.d/ab26-pension-tax-allowance.added.md

@@ -0,0 +1 @@
+Add the Pension Tax Allowance announced at Budget 2026: from 6 April 2027 to 5 April 2030, people over State Pension age (or reaching it within the tax year) get a non-refundable Income Tax reduction of 20% of the full new State Pension above the Personal Allowance, rounded up to the pound (£94 in 2027-28), tapered by £1 for every £3 of total income above the full new State Pension (52 weeks at the weekly rate, so it follows any change to that rate). Universal Credit's deduction for tax on earnings sees it.

changelog.d/ab26-savings-property-rates.changed.md

@@ -0,0 +1 @@
+Raise the savings and property income rates to 24%, 44% and 49% from 6 April 2027 (Budget 2026).

changelog.d/ab26-trading-allowance.changed.md

@@ -0,0 +1 @@
+Raise the trading allowance to £3,000 from 6 April 2027 (Budget 2026).

docs/book/assumptions/carer-support-payment-earnings.md

@@ -88,16 +88,65 @@ second candidate entitlement before reducing either payment for overlapping
 benefits. A selected carer whose overlapping benefit removes the payment
 still retains the underlying entitlement.
 
-The law provides election or decision rules; the model does not observe that
-choice. Among otherwise eligible partners, it prefers a reported recipient,
-then an eligible benefit-unit head, then the eldest eligible partner. Member
-order breaks an age tie. This is a modelling convention, not statutory
-priority. An ineligible reported recipient or head cannot displace an eligible
-partner. The caring-hours, earnings, age and take-up conditions are unchanged.
-
-The convention does not maximise the couple's payment. It can select a partner
-whose overlapping benefits reduce CA or CSP to zero, while suppressing a
-payment that the other otherwise-eligible partner could receive if selected.
+The couple jointly elect which of them has the entitlement; the Secretary of
+State decides only where they don't. The data don't record the election, so
+the model takes the one that gives the larger award: of the otherwise eligible
+partners, the one whose candidate award is larger has the entitlement. The
+model's own awards differ only under the Budget 2026 Carer's Allowance
+earnings taper; everywhere else each eligible partner has the same rate. An
+award that an input supplies can differ in any year, and the election then
+follows it. Where the awards are equal, the model prefers a reported
+recipient, then an eligible benefit-unit head, then the eldest eligible
+partner, and member order breaks an age tie. That order is a modelling
+convention, not statutory priority. An ineligible reported recipient or head
+cannot displace an eligible partner. The caring-hours, earnings, age and
+take-up conditions stay as they are.
+
+In 2030-31, the year the taper starts, the model applies the election
+separately to the weeks before the taper and the weeks under it, since the law
+restricts entitlement day by day. Where the two partners have the same award
+for those weeks, the couple elect the one with the larger award over the year,
+and then the order above applies. A partner below the earnings limit has the
+full rate in both parts and the larger award over the year, so the couple
+elect them for the whole year, even where the other partner's award under the
+taper equals the full rate, as it does at a taper rate of zero. Where both
+partners earn over the limit, neither has an award before the taper, and the
+couple elect the one with the larger award under it. Either way one partner
+has the award for the year, at any taper rate of zero or more. A
+`carers_allowance_pre_couple_limit` that an input supplies carries no dates,
+so the restriction keeps one partner's award for the whole year.
+The parts of the year reach the payment as shares of the year:
+`carers_allowance_pre_overlap` is the amount from
+`carers_allowance_pre_couple_limit` that the restriction keeps, and
+overlapping benefits come off for the share of the year in which the
+restriction keeps it.
+
+The shares describe an amount only where the model's own formulas calculate
+it from the parts of the year and, for every member of the benefit unit, it
+is the amount the parts give: within half a penny, and an award, however
+small, exactly where the parts give one, since the couple restriction chooses
+only among partners with an award. An amount that an input supplies, or that
+a reform neutralizes or calculates with a formula of its own, carries no
+dates, even where it equals the model's: a value cannot show where it came
+from. So does an amount that a reform changes while keeping the formula, for
+example by adding `defined_for`. A `carers_allowance_pre_couple_limit` of that
+kind gets the couple restriction for the whole year, and the whole year's
+overlapping benefits come off what the restriction keeps. A
+`carers_allowance_pre_overlap` of that kind comes after the couple
+restriction, so only the whole year's overlapping benefits come off it.
+Either way, the payment starts from that value, and where the
+`carers_allowance_pre_overlap` is of that kind, the payment doesn't read the
+stage before it. A reform that changes only a variable's label, say, keeps
+the parts of the year. The test of the formula covers the whole variable, so
+a reform that wraps the formula to change one person's amount moves every
+amount to the whole-year treatment. The model treats less than half a penny
+for the year, which in practice is floating-point residue where an
+overlapping benefit equals the award, as nil, and pays a penny.
+
+The election compares awards before overlapping benefits, so it doesn't always
+maximise what the couple receive: it can choose a partner whose overlapping
+benefits reduce CA or CSP to zero, where choosing the other partner would pay
+something.
 
 The existing same-person default remains: two qualifying reported awards, or
 awards that caring hours and take-up cannot explain, indicate different care

docs/book/programs/gov/treasury/cost-of-living-payments.md

@@ -28,6 +28,37 @@ PolicyEngine models these via:
   - `council_tax_rebate/bands.yaml` — qualifying CT bands (A–D)
   - `council_tax_rebate/amount.yaml` — the £150 rebate amount
 
+## Household Energy Payment (2026-27)
+
+Budget 2026 (paragraph 6.24) announced a one-off £100 Household Energy
+Payment for households in council tax bands A to D in England, which local
+authorities pay into bank accounts from January 2027. PolicyEngine models it as
+`household_energy_payment` (Household, YEAR), with parameters at
+`parameters/gov/treasury/household_energy_payment/`:
+
+- `amount.yaml`: £100 in model year 2026 (6 April 2026 to 5 April 2027),
+  zero otherwise
+- `bands.yaml`: qualifying bands (A to D)
+- `countries.yaml`: qualifying countries (England)
+
+It counts in `household_benefits` and `gov_spending`, as the Energy Bills
+Rebate does, and in `hbai_household_net_income`: HBAI counted the 2022
+Council Tax Rebate and the Energy Bills Support Scheme as miscellaneous
+income ([HBAI quality and methodology report FYE 2023](https://www.gov.uk/government/statistics/households-below-average-income-for-financial-years-ending-1995-to-2023/households-below-average-income-series-quality-and-methodology-information-report-fye-2023)).
+The devolved governments receive a Barnett share instead, which the model
+does not allocate, and the model leaves out the £100 million of further
+local-authority funding for targeted support.
+
+The payment goes to the householder [liable for council tax on their main
+home](https://www.gov.uk/government/news/what-the-autumn-budget-2026-means-for-your-energy-bills),
+including most households exempt from council tax; full criteria are to
+follow. The model pays every household in a qualifying band. Survey data
+hold only main homes, so the second homes and empty properties the scheme
+excludes do not arise. The model can't tell which households have a
+landlord liable for council tax (council tax in the rent), so it pays them,
+which slightly overstates recipients. `council_tax_band` defaults to band D,
+so a household whose survey record has no band qualifies.
+
 ## Cost-of-Living Payments (2022-23 and 2023-24)
 
 Two successive packages, both modelled through the variable

docs/engineering/excise-duties.md

@@ -18,11 +18,11 @@ parameter history starts on 1 August 2023; the preceding alcohol regime and a
 complete 2023/24 calculation are outside this implementation. Tobacco rates
 start on 22 November 2023. The new alcohol, tobacco and car formulas return their
 default zero before 2024; that is an unmodelled period, not a statutory exemption.
-Gas duty covers 2022/23 onwards and includes the 1 January 2027 and 1 March 2027
-increases. SI 2026/555 removed the September 2026 step announced at Budget 2025
-and moved the December 2026 step to 1 January 2027. Rates after the last dated
-entry stay constant; the gas parameters do not forecast future inflation
-increases.
+Gas duty covers 2022/23 onwards. SI 2026/555 removed the September 2026 step
+that Budget 2025 announced and moved the December 2026 step to 1 January 2027.
+Budget 2026 then kept the proportionate cut to 1 July 2027, when the gas rates
+return to their full levels with RPI growth on top, and rise by RPI each 1 April
+from 2028, as petrol and diesel do (see below).
 
 For alcohol and tobacco, a model year such as `2026` represents 6 April 2026 to
 5 April 2027. Quantities and cigarette retail prices are constant across that
@@ -154,35 +154,45 @@ matching the legislation. No universal litre-to-kilogram density is assumed.
 The existing `fuel_duty` output includes these charges. Rural fuel duty relief
 continues to apply only to petrol and diesel.
 
-From 1 March 2027 onwards, the gas parameters hold LPG at £0.3161/kg and natural
-gas at £0.2470/kg. This implementation stops at the last numerical rates in the
-HMRC 2026-to-2027 schedule and does not extrapolate gas rates using an inflation
-forecast. This is a modelling limitation: HMRC states that RPI uprating resumes
-from 2027/28. The petrol and diesel rate includes forecast RPI uprating each
-1 April from 2027, so its rates rise while the gas rates stay flat. Later-year gas duty is therefore lower than it would be
-under the same uprating assumption. Analyses beyond March 2027 that require
-consistent fuel-duty forecasts must supply an uprated gas-rate path explicitly.
+Budget 2026's costing says that on 1 July 2027 "fuel duty rates will increase
+by 5ppl and will be uprated in line with the Retail Prices Index (RPI)", and
+applies the cut to other fuels in proportion. So on 1 July 2027 the gas rates
+return to their full rates before the 2022 cut (LPG £0.3161/kg, natural gas
+£0.2470/kg), with the same RPI growth as petrol and diesel. HM Treasury
+publishes the rates from 1 July 2027 in Annex A of Budget 2026's Overview
+of Tax Legislation and Rates: £0.3305/kg and £0.2582/kg (the uprating gives
+£0.2583/kg for natural gas, and the model uses HM Treasury's rate). Each
+1 April from 2028 they rise by the previous calendar
+year's RPI growth. `calculate_fuel_duty_rates.py` writes these steps to
+1 April 2031, as it does for petrol and diesel, and the parameters' uprating
+metadata continues them. That is policy, not law.
 
 Sources: [HMRC fuel duty rates 2026 to 2027](https://www.gov.uk/government/publications/fuel-duty-rates-for-2026-to-2027/fuel-duty-rates-2026-to-2027)
 (RPI uprating from 2027/28),
 [HMRC amended fuel duty rates 2026 to 2027](https://www.gov.uk/government/publications/amended-fuel-duty-rates-for-2026-to-2027/amended-fuel-duty-rates-2026-to-2027)
-and [SI 2026/164 as amended by SI 2026/555](https://www.legislation.gov.uk/uksi/2026/164).
+[SI 2026/164 as amended by SI 2026/555](https://www.legislation.gov.uk/uksi/2026/164)
+and [Budget 2026 policy costings, page 13](https://assets.publishing.service.gov.uk/media/6ae1883fe4367e5c8b0467df/AB26_Policy_Costing.pdf#page=13).
 
 ## Petrol and diesel rate
 
 The main rate on unleaded petrol and diesel is keyed to each statutory change:
-52.95p a litre from 23 March 2022, continued by annual orders to 31 December 2026;
-55.95p from 1 January 2027 (SI 2026/164 as amended by SI 2026/555); and the Hydrocarbon Oil
-Duties Act 1979 rate of 57.95p from 1 March 2027. Budget 2025 states that rates
-will be uprated by RPI from April 2027, and HM Treasury's Budget 2025 costing
-dates this from 1 April 2027. That uprating is policy, not law: HMRC's amended
-note of 22 May 2026 says final rates will be confirmed at Budget 2026. No
-official source names the RPI measure. The model applies the previous calendar
+52.95p a litre from 23 March 2022, continued by annual orders to 31 December 2026
+(SI 2026/164 as amended by SI 2026/555). Those orders then stepped to 55.95p on
+1 January 2027 and to the Hydrocarbon Oil Duties Act 1979 rate of 57.95p on
+1 March 2027. Budget 2026 (paragraph 6.211) cancelled both steps and kept the
+cut to 1 July 2027. Its costing (page 13) says: "On 1 July 2027, fuel duty rates
+will increase by 5ppl and will be uprated in line with the Retail Prices Index
+(RPI). From 1 April 2028, fuel duty rates will be uprated annually in line with
+RPI." That is policy, not law. The OBR's October 2026 EFO (paragraph 3.19)
+puts the rate at 60.59p from 1 July 2027: RPI growth in the year to 2027 Q1
+(4.5565%, economy Table 1.7) on the 57.95p pre-cut rate. The model
+uses that figure, and `calculate_fuel_duty_rates.py` refuses to write any
+other July rate. From 1 April 2028, each step applies the previous calendar
 year's RPI growth from the OBR forecast in
-`gov.economic_assumptions.yoy_growth.obr.rpi` on each 1 April, rounded to the
-nearest hundredth of a penny. The steps to 1 April 2031 are written out by
-`calculate_fuel_duty_rates.py`, and a test fails when they fall out of date
-with the RPI forecast. Later steps come from the parameter's uprating metadata.
+`gov.economic_assumptions.yoy_growth.obr.rpi`, rounded to the nearest
+hundredth of a penny. The script writes the steps to 1 April 2031, and a test
+fails when they fall out of date with the RPI forecast. After a new EFO, set
+the script's July rate and RPI growth to its forecast and rerun it. Later steps come from the parameter's uprating metadata.
 The RPI index ends in 2039, so the last step is 1 April 2040.
 
 An annual reform names a model year and replaces the rate for all of it. For

policyengine_uk/data/fiscal_partition.yaml

@@ -720,6 +720,7 @@ exclusions:
   - {variable: married_couples_allowance_deduction, kind: component, head: income_tax, note: "Inside capped_mcad."}
   - {variable: other_tax_credits, kind: component, head: income_tax, note: "A tax reduction, subtracted inside income_tax."}
   - {variable: property_finance_cost_relief, kind: component, head: income_tax, note: "A tax reduction, subtracted inside income_tax."}
+  - {variable: pension_tax_allowance, kind: component, head: income_tax, note: "A tax reduction, subtracted inside income_tax."}
   - {variable: basic_rate_earned_income_tax, kind: assessment, head: income_tax, note: "Earned income tax by band; earned_income_tax does not read it."}
   - {variable: higher_rate_earned_income_tax, kind: assessment, head: income_tax, note: "As above."}
   - {variable: add_rate_earned_income_tax, kind: assessment, head: income_tax, note: "As above."}
@@ -1257,7 +1258,7 @@ spending_heads:
     totals: [gov_spending, household_benefits]
     sign: nonnegative
     caseload: false
-  # Cost-of-living and energy support (none in force at current law)
+  # Cost-of-living and energy support
   - id: cost_of_living_support_payment
     label: Cost-of-living support payment
     variable: cost_of_living_support_payment
@@ -1274,6 +1275,14 @@ spending_heads:
     totals: [gov_spending, household_benefits]
     sign: nonnegative
     zero_at_baseline: expected
+  # Paid in 2026-27 only (Budget 2026), so not zero at current law.
+  - id: household_energy_payment
+    label: Household Energy Payment
+    variable: household_energy_payment
+    entity: household
+    report_group: cost_of_living_support
+    totals: [gov_spending, household_benefits]
+    sign: nonnegative
   - id: epg_subsidy
     label: Energy Price Guarantee subsidy
     variable: epg_subsidy

policyengine_uk/parameters/gov/dwp/carers_allowance/earnings_taper/applies.yaml

@@ -0,0 +1,14 @@
+description: Share of the fiscal year in which Carer's Allowance tapers on earnings above the limit instead of stopping in full.
+values:
+  # The taper "will begin within the 2030-31 financial year, with a precise
+  # start date confirmed in due course" (policy costings, page 16). Until DWP
+  # confirms the date, the model starts it on 6 October 2030, the middle of
+  # 2030-31. fiscal_year_blend day-weights the year, so 2030-31 carries 182
+  # of its 365 days. Change the date here when DWP confirms it.
+  0001-01-01: 0
+  2030-10-06: 1
+metadata:
+  unit: /1
+  period: year
+  fiscal_year_blend: true
+  label: Carer's Allowance earnings taper share of year

policyengine_uk/parameters/gov/dwp/carers_allowance/earnings_taper/countries.yaml

@@ -0,0 +1,12 @@
+description: Countries in which Carer's Allowance tapers on earnings above the limit. Scotland pays Carer Support Payment instead, and Northern Ireland keeps the withdrawal in full.
+values:
+  0001-01-01:
+    - ENGLAND
+    - WALES
+metadata:
+  unit: list
+  period: year
+  label: Carer's Allowance earnings taper countries
+  reference:
+    - title: Budget 2026, paragraph 6.13 (the taper will "apply in England and Wales")
+      href: https://assets.publishing.service.gov.uk/media/6ae1ec57bdb574cf1c9b3f12/E03668986_HMT_Budget_2026_ELAY__2_.pdf#page=116