22nd October 2026
With inflation rising and Christmas approaching, retailers are asking the Chancellor to reduce the cost of doing business rather than introduce further taxes that could feed through into shop prices.
The Budget on 28 October comes at a critical time for Britain's retailers. Households are watching their spending, shops are facing higher operating costs, and many high streets are still struggling to attract enough customers to keep businesses viable.
The British Retail Consortium (BRC), which represents retailers across the UK, has made its position clear. It wants a Budget that reduces the costs facing businesses, helps hold down prices and gives retailers more confidence to invest in shops and jobs.
This is not simply a request for lower taxes to improve company profits. Retailers argue that when the cost of running a shop rises, the consequences can reach much further. Businesses may put up prices, postpone investment, reduce staffing or decide that a store is no longer worth keeping open.
The challenge for Chancellor John Healey is to decide whether the Budget can ease these pressures without creating additional problems for the public finances.
Business rates are at the top of the list
One of the BRC's principal demands is a freeze in business rates for the coming year, avoiding another increase linked to inflation.
Business rates are a tax on commercial properties, including shops, supermarkets and warehouses. Unlike corporation tax, which is charged on taxable profits, business rates can remain payable even when a business is struggling to make money.
That makes them particularly important to retailers operating from expensive premises or running large stores with substantial staffing and energy requirements.
The BRC has warned that the latest inflation figures could mean around £250 million in additional business rates bills for retailers from April 2027 unless the Government intervenes.
Retailers are also concerned about the higher business rates multiplier applying to properties with a rateable value above £500,000. Many large supermarkets and major retail outlets fall into the category that could be affected.
The industry fears that a policy intended to provide relief to some businesses, such as pubs and other hospitality venues, could leave other parts of the high street facing a larger bill.
Retailers are therefore asking the Chancellor not to solve one sector's problems by transferring costs to another.
Their argument is that large stores are not necessarily detached from the fortunes of the wider high street. A supermarket or department store can attract customers to an area, supporting smaller shops and other businesses nearby.
If the larger store reduces its investment, cuts its opening hours or closes altogether, the consequences may extend beyond its own workforce.
The cost of employing people
The second major issue is the rising cost of employing staff.
Retail is one of Britain's largest employers, providing work for people across the country, including school leavers, students, part-time workers and people looking for their first step into the labour market.
The BRC wants the threshold at which employers start paying National Insurance contributions raised from £5,000 to £6,000 a year.
The industry argues that the existing threshold, combined with higher employment costs, makes it more expensive to recruit and retain staff. For a business employing hundreds or thousands of people, even a relatively modest additional cost per employee can add up quickly.
Retailers are particularly concerned about entry-level and part-time jobs. The traditional Saturday job, once a familiar route into working life for school pupils, has become harder for some employers to justify.
A shopkeeper deciding whether to employ another person must consider not only wages but also employer National Insurance, pension contributions, training and other employment obligations.
If employing someone becomes significantly more expensive, the business may choose to make do with fewer staff, rely more heavily on self-service technology or leave a vacancy unfilled.
That may reduce costs for the employer, but it also means fewer opportunities for young people to gain experience and earn their own money.
The Government faces a genuine balancing act. Workers need fair pay and protection, while employers need a system that does not discourage them from offering jobs in the first place. The aim should be to improve employment conditions without making it unnecessarily difficult to recruit.