Shops worry they are going to be ‘whacked’ within the Budget

Shops fear they will be ‘whacked’ in the Budget as nervous households rein in spending.

The High Street is braced for a series of punishing tax rises – including an increase in National Insurance paid by employers and business rates.

The hikes – set to be outlined by Chancellor Rachel Reeves in her Budget on October 30 – will come on top of a series of new rights for workers that have piled yet more regulation on business. 

To make matters worse, there are signs that shoppers are holding back as concerns about what Reeves has planned dent confidence.

Retail sales rose by just 0.3 per cent in September, according to the Office for National Statistics, having increased by a far stronger 1 per cent in August. The slump came as Reeves prepares a Budget that could include more than £40billion of tax rises as she struggles to pay for Labour’s spending pledges.

Concern: The High Street is braced for a series of punishing tax rises – including an increase in National Insurance paid by employers and business rates

Kris Hamer of the British Retail Consortium said: ‘Retailers are nervously waiting for the Budget to see if they are going to be whacked by more costs, particularly trailed changes to employer National Insurance Contributions, as well as the inflationary increase to business rates.

‘These changes would add more pressure to an industry that already pays far more than its fair share in business taxes.’

Elliott Jordan-Doak, senior UK economist at Pantheon Macroeconomics, said ‘doom-mongering from the Government’ has hit confidence.