Retailers warn that budget changes will make job losses inevitable
Some of the UK’s biggest retailers have written to the Government to warn that last month’s budget will result in higher prices and jobs losses, as well as reduced investment in the sector.
The letter organised by the British Retail Consortium has been signed by over 70 retailers, including the likes of Asda, Primark, Marks & Spencer, Next, Tesco, Sainsbury’s, Morrisons and Kingfisher.
Subscribe to TRBIn October, the Chancellor Rachel Reeves announced employers’ National Insurance Contribution will rise to 15% from 13.8 % in April with the threshold being lowered to £5,000 from £9,100.
The letter stated: “For any retailer, large or small, it will not be possible to absorb such significant increases over such a short time scale. The effect will be to increase inflation, slow pay growth, cause shop closures and reduce jobs, especially at the entry level.”
The retailers also stated that the industry will be facing £7 billion worth of extra costs from 2025 following the additional impact of higher business rates and new packaging levies as a result of the extended producer responsibility scheme.
This has led them to also call for the Government to phase in the introduction of the National Insurance changes and delay the start of the packaging levies.
Earlier this month, analysis by Morgan Stanley showed that Tesco will face £1 billion extra tax bill following National Insurance hike.
