UK businesses are increasingly worried about rising tax burdens, prompting plans to raise prices, according to a British Chambers of Commerce (BCC) survey. Confidence among firms has plummeted to its lowest point since the “mini-budget” crisis of autumn 2022. The survey revealed that 63% of companies identified tax as a significant concern, up from 48% in the previous quarter. More than half (55%) of businesses expect their costs to rise in the next three months, mainly due to increased labour expenses following a National Insurance hike. Additionally, the percentage of firms anticipating a boost in turnover over the next year dropped to 49%, from 56%. Sectors such as hospitality, manufacturing, construction, and healthcare expressed anxiety about sustaining additional expenses and potential reductions in investment. Shevaun Haviland, BCC head, emphasized the need for the government to take immediate action to support the economy while addressing tax increases. U.K. borrowing costs have risen since the October 2024 budget, surpassing the peaks seen during the 2022 mini-budget, although economists note that the current bond yield increases have been less severe due to overall macroeconomic improvements, including easing inflation.
