Chancellor Warns: Rising Taxes Could Trigger Job Cuts and Price Surges

Retail Bosses Feeling the Burn – Budget Policies Heating Up Prices and Cooling Jobs

Top‑line Mood Snapshot

Retail CFOs and Finance Directors from more than 9 000 stores have spoken out. A slim 11 % of them feel optimistic about the next year, while a whopping 56 % say the outlook is pessimistic. In the middle ground, only 33 % are ambivalent. That’s a clear sign the government’s policy moves are turning the retail environment into a hot‑dish hot‑pot.

Prices Are Rising, Prices Will Rise More

85 % of CFOs say their stores had to hike prices after the latest Budget.
About 65 % predict further increases within the next 12 months.
Food inflation, already climbing at 4.0 % (BRC‑NielsenIQ), is expected to reach up to 6 % by year‑end.

With food costs surging, households are staring down a dinner that’s getting heavier by the week, especially as Christmas shopping looms.

Jobs and Investments in the Balance Beam

42 % of CFOs have frozen recruitment.
38 % have cut in‑store staff numbers.
Early 2025 saw almost 100 000 fewer retail jobs compared with last year.
38 % of CFOs scaled back community investment.
One in six (15 %) already delayed new store openings.

Tax and Regulation – The Big Penny‑Cushion Fears

From January’s 62 % to this week’s 88 %, the “Tax and regulatory burden” swooped into the top three concerns for almost nine out of ten CFOs. National Insurance, Business Rates, the National Living Wage, and the new packaging tax are all now on the frontline of anxiety.

Why Retailers Are the Scapegoat

Retailers provide millions of part‑time and entry‑level jobs (over 5.7 million nationwide).
Changes to the National Insurance threshold and National Living Wage hit retailers and their supply chains hard.
Government plans to tweak business rates will likely lower rates for some large retail, hospitality, and leisure (RHL) outlets, but the success will depend on how well the reforms are tailored.

A Word From Helen Dickinson, BRC Chief Executive

“Retail was squarely in the firing line of the last Budget, incurring £7 billion in new costs and taxes. Retailers have tried hard to shield customers, but thin margins and higher staffing costs made price rises inevitable. Now shoppers feel the pinch as everyday grocery costs climb.”

What’s at Stake?

Retail makes up 5 % of the economy and pays 7.4 % of business taxes plus a hefty 21 % of all business rates. If the Chancellor doesn’t step in to ease rates and keep cost burdens under control, the entire public will feel the inflation warming pot.