Retailers wrote to the chancellor, warning about the impact of an extra PS7bn they will face in the coming year due to the budget.
Amazon UK, Tesco Next, Asda and other major UK retailers, such as Tesco, Next, and Asda say that the “cumulative impact” of the Rachel Reeves’ October announcements would have a negative effect on employment, inflation, and the economy.
The British Retail Consortium, a group of 79 retailers, has sent a letter to its members claiming that job losses, higher prices and closures are inevitable due to the increased employer National Insurance Contributions (NICs) as well as the national living wage.
In the letter, it is stated: “We acknowledge the importance of the government’s efforts to improve the fiscal situation and invest in public services. We also recognize the role that businesses play in this.” The sheer magnitude of the new costs, as well as their speed, creates a cumulative burden, which will lead to job losses and price increases.
The list also included Marks and Spencer’s boss, Boots’, Currys’, Lidl’s, JD Sports’, Greggs’, Primark’s’, Morrisons’ and Sainsbury’s’, charity shops and Associated Independent Stores’.
The group states that “the impact of budget NIC threshold changes is particularly acute, given the large number of retail employees in entry-level or part-time positions”.
According to the BRC it would “welcome” the opportunity for a meeting Reeves in which it will recommend certain changes to the measures announced in budget, such as phasing-in of the NI lower earning threshold.
The letter continued: “By changing the timing of some of these change, the government will give businesses enough time to adapt and greatly reduce their harmful effects on the high streets and consumer.”
