The Government should cut public spending rather than increase taxes in its next Budget, the British Retail Consortium has urged.

In a Budget submission published today, the BRC warned that tax rises could push the country back into recession and called for reductions in employment and property costs.

BRC director general Stephen Robertson said: “The size of the country’s deficit means action must be taken. To nurture our fledgling recovery, the main tool for dealing with the deficit has to be cutting non-vital public sector spending.

“Some tax rises may be inevitable, but no government should rely on tax hikes to reduce borrowing. The increases would be so large that that customers’ ability to spend would be wrecked – risking a double-dip recession.”

The organisation called for employment costs to be cut by scrapping the 1% increase in National Insurance planned for 2011 and restricting this year’s National Minimum Wage increase to 1% at most.

The BRC said that businesses affected by the Business Rate Supplement should be able to vote down any plans that “do not deliver adequate local economic benefits”. It recommended that temporary Empty Property Rate Relief should be extended, allowing more empty properties to qualify for an exemption from business rates until 2012.

The Budget is expected next month.

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