Leaders from across the sector have signed a letter calling on the government to phase in changes to national insurance contributions to ease the burden on the retail from the Budget.
In an open letter to the chancellor authored by the BRC and signed by 79 retail leaders from across the sector, the membership body has called on the government to phase in the introduction of the new lower earnings threshold on national insurance, delay the timelines for implementation on packaging levies and bring forward the timetable on business rates reform to make the Budget fairer on retail.
“We would welcome the opportunity to meet with you to discuss our concerns and to work together on a solution,” the letter said of its proposals.
“By adjusting the timings of some of these changes, the government would give businesses time to adjust and greatly mitigate their harmful effects on high streets and consumers.
Without action, the letter warns, retail businesses large and small will struggle, as it’s “not possible to absorb such significant cost increases over such a short timescale”.
The letter warns that the government’s actions at the Budget will “increase inflation, slow pay growth, cause shop closures, and reduce jobs, especially at the entry level.
“This will impact high streets and customers right across the country,” it adds. “We are already starting to take difficult decisions in our businesses, and this will be true across the whole industry and our supply chain.”
The BRC estimates that the rate increase changes to national insurance contributions will cost retail £0.57bn, the threshold changes will add £1.76bn and the increase in the national living wage will add £2.73bn.
With the contribution of the new packaging levy, which will add £2bn to retail’s costs from October 2025, the total of new costs heaped on the retail sector by the end of 2025 will be over £7bn.
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