According to a survey conducted by the British Retail Consortium, UK retailers are planning to raise prices this year as a direct consequence of heightened National Insurance costs. Two-thirds of the Chief Financial Officers (CFOs) surveyed indicated intentions to increase prices, while approximately half are considering reducing the number of employee hours or cutting back on overtime.
The survey further highlighted concerns regarding the budget's impact on business investments. Around 46% of CFOs expressed plans to decrease capital expenditures, and 25% indicated intentions to postpone new store openings. Additionally, about 70% of the respondents held a "pessimistic" or "very pessimistic" outlook regarding trading conditions over the next year.
The top three issues troubling CFOs include declining demand for goods and services, inflationary pressures, and the escalating tax and regulatory burden.
Helen Dickinson, Chief Executive of the BRC, commented, "With the Budget increasing their costs by over £7 billion in 2025, retailers are now confronting challenging decisions related to future investment, employment, and pricing strategies."
Dickinson also emphasized that the government still has the opportunity to bolster retail investment and confidence. She pointed out that business rates are a significant barrier to the establishment of new shops and job creation, with retailers bearing more than a fifth of the total rates bill.
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