Upcoming tax hikes will be “unmanageable” for UK businesses, warns JD Sports chairman, as the industry braces for rising costs following the recent Budget.
Andrew Higginson, also chair of the British Retail Consortium, cautioned that consumers could face “significant inflation” unless Chancellor Rachel Reeves opts to gradually phase in her proposed £40bn tax increases.
Higginson highlighted that the forthcoming 6.7% rise in the National Living Wage, set to reach £12.21 per hour in April, may be offset by retailers increasing prices to cover rising costs.
Businesses are also preparing for a £25bn hike in employer National Insurance contributions, which will increase from 13.8% to 15%.
Speaking on BBC Radio 4’s Today programme, Higginson stated: “It’s the scale of the combined increases hitting all at once. Retail is facing higher costs from National Insurance, minimum wage hikes, and changes to business rates, despite previous promises of reductions. This equates to a £5bn annual burden, leaving businesses with limited options: cut back on investment, hiring, and jobs, or raise prices.”
He added, “A 6.5% wage increase sounds good, but if inflation spirals, it’s not a real gain for workers, is it?”
Higginson warned, “If these measures proceed without any easing, we’re bound to see significant inflation in retail prices. The cumulative impact is too great for the industry, hampering its ability to invest and grow.”
