Business leaders are concerned and apprehensive as Budget day dawns and firms from start-ups to Square Mile stalwarts wait with bated breath for Rachel Reeves to reveal the extent of the tax rises contained in the government’s first fiscal event after 14 years out of power.
Pollsters asked bosses and senior executives to select from a choice of words to describe their feelings about the Budget, with 25 per cent opting for “concerned” followed by 22 per cent confessing to feeling “apprehensive”. Just one in five said they felt “positive” about today’s statement, according to Savanta.
It comes amid widespread speculation that Reeves is set to hike a range of taxes on businesses and financiers, with the bank levy, capital gains tax, and carried interest, employers’ national insurance contributions (NICs) and the non-doms regime all under the microscope.
Leaders of small businesses reported particular concern, Savanta’s monthly business tracker found, with almost two thirds saying they felt “nervous, concerned or apprehensive”.
Tina McKenzie, from the Federation of Small Businesses (FSB), urged Reeves to unveil a plan that proves “good for jobs, good for growth, and good for economic prosperity”.
She stressed the lobby group’s calls for a substantial uplift to the employment allowance, decisive action on business rates and the protection of entrepreneurs’ relief.
Labour has framed the Budget as part of an effort to boost private investment in the UK, via its inaugural international summit this month, in a bid to kickstart the sustained economic growth it pledged to deliver in its pre-election manifesto.
Reeves is also expected to confirm changes to the UK’s debt rules in a bid to unlock billions to spend on infrastructure.
Reeves: no shortcuts to economic growth
The UK’s first female Chancellor is expected to tell the House of Commons: “The prize on offer to today is immense.
“An economy that is growing, creating wealth and opportunity for all. Because that is the only way to improve living standards.
“And the only way to drive economic growth is to invest, invest, invest. There are no shortcuts. To deliver that investment we must restore economic stability.”
But Savanta consultant Matt McGinn said: “There’s a real sense of concern among business leaders ahead of Labour’s first budget,” adding that “Keir Starmer and Rachel Reeves will likely be concerned how quickly years of goodwill among businesses appears to have dissipated.”
A Treasury spokesperson said: “As the Chancellor made clear at the International Investment Summit, when we said we would end instability, make growth our national mission and enter a true partnership with business, this government meant it.
“We’re supporting businesses through pledges to make the business rates system fairer, capping corporation tax at 25 per cent and publishing a corporate tax roadmap so they have certainty to plan for the future.”