‘Tale of two halves’: Industry reacts to ‘damaging’ Autumn Budget

The Autumn Budget, the first to have been issued by Labour in 13 years, has received mixed reactions from industry insiders and experts alike, with a 40 billion pound uptick in taxes being at the centre of discussion. On Wednesday, Chancellor Rachel Reeves unveiled the budget via a lengthy speech in which she noted that she did “not take this decision lightly”.

Among the changes to be implemented is the scrapping of the current 75 percent discount on business rates set to expire in April 2025. It will then be replaced by a 40 percent discount, capped at 110,000 pounds. The National Living Wage (NLW) meanwhile is to increase to 12.21 pounds per hour for those aged 21 and over, while National Insurance Contributions are to increase to 15 percent, alongside a lowered threshold for payment.

LCD Ventures

For some, including urban innovation company LCD Ventures, the reform on business rates was a “promising step”, however the company’s CEO, Florian Wupperfeld, said it was “not a silver bullet to saving Britain’s struggling retailers and high streets”.

Wupperfeld elaborated: “The much-needed business rates reform must now fit into a holistic approach that considers the diverse needs of Britain’s high streets, and prioritises local businesses and SMEs over large conglomerates.”

Altus Group

According to commercial real estate firm Altus Group, however, the reduction to business rates discounts could mean an average 140 percent rise in business rates bills for more than 250,000 high street premises, and thus the average shop is now anticipated to see an uptick from 3,589 pounds to 8,613 pounds.

President of the firm, Alex Probyn, said “despite Labour’s manifesto recognition of the undue burden business rates place on our high streets, this Budget actually increases that burden by 688 million pounds for those types of business for next year in the short term”.

Bira

British Independent Retailers Association (Bira) all out “condemned” the budget, calling it the “most damaging for independent retailers in recent memory”, with doubled business rates, an increase in National Insurance and higher minimum wages dubbed a “triple blow” by the organisation.

CEO of Bira, Andrew Goodacre, said the budget was the “worst” seen in his time representing the sector, and showed “complete disregard for the thousands of hard-working shop owners who form the backbone of our high streets”.

“For all the government's rhetoric about supporting small businesses and revitalising high streets, their actions do precisely the opposite. These punishing measures will force many shop owners to make heart-breaking decisions about their businesses' future,” Goodacre said.

He continued: "This is clearly an anti-high street Budget. I can only assume that the government is happy for working people to shop online and buy cheap imports. This government has shown complete disregard for the local businesses that create jobs and maintain vibrant communities.”

RSM UK

At RSM UK, a similar mindset could be seen, with the company’s partner and head of leisure and hospitality, Saxon Moseley, stating that the series of cuts and increases could “leave many businesses on a financial cliff edge”.

Moseley continued: “Promises of business rates reform in 2026 will be welcomed, but need to be set against a real terms 140 percent increase in next year’s rates bill for small businesses resulting from the existing relief being reduced. Combined, these measures overshadow more positive news regarding investment in filling the skills shortages which have plagued the hospitality industry, plus promises to tackle shoplifting which have eroded retail margins.”

Alvarez and Marsal

At consultancy firm Alvarez and Marsal, the budget told a “tale of two halves” for managing director and head of retail and consumer, Europe, Erin Brookes. Contrasting other opinions, Brookes said the business rates relief would “avoid the cliff-edge”, while the “maintenance of R&D tax relief will help encourage investment in new technology and products”.

Brookes saw the increase in NLW as a possible mode of boosting consumer confidence, yet the resulting rise in operating costs “could lead to a challenging adjustment period”. She added: “To manage these added costs, we could see businesses prioritising cost efficiencies elsewhere to stay resilient against this headwind."

BRC

British Retail Consortium (BRC) chief executive, Helen Dickinson, said: “For a low margin industry, today's Budget will hit hard, with the odds now stacked firmly against growth and investment in the short term. These new costs also risk increasing the prices customers pay at the till.”

In regards to the Business Rates reform, Dickinson added: “While retailers welcome future action on rates, they are assessing the impact of today’s announcement. There remain many unanswered questions about the new charges and discounts that will be levied from 2026. Charging more to businesses with higher rateable values may punish not only distribution hubs, but also larger stores, which play a key role in attracting footfall to high streets and town centres.

“With retailers paying over 21 percent of all business rates in the economy, the solution is not to simply shift the burden around the industry, but to look outside retail. Without action to address the disproportionate impact of business rates on retail, the government’s plan is simply robbing Peter to pay Paul.”