Responding to the Chancellor’s 2026 Budget, Helen Dickinson, Chief Executive of the British Retail Consortium, said:
“Today’s Budget will see retail costs keep climbing as the Chancellor failed to provide the breathing space he promised. Retail faces £41 billion in business taxes this year, over 120,000 jobs have been lost in just two years, and one in seven shops lies empty. Yet employment costs continue to rise. Business rates continue to rise. The Government cannot keep talking about reviving high streets while failing to address the rising tide of costs that holds them back.”
On Business Rates:
“This was a smoke and mirrors announcement on business rates. The Chancellor’s headline announcement that he will ‘freeze [retail, hospitality and leisure] rates in real terms’ means a 3.5% increase - another body blow to high streets already struggling with rising costs and empty units.
“It will add around £250 million to retailers’ bills next April as one in seven shops lies empty. And while we welcome the decision to remove 70,000 small high street businesses from paying business rates altogether, the overwhelming proportion of employment and rates come from the 500,000 medium and larger retail outlets whose bills will go up once again. Retail accounts for around 5% of the economy yet pays over 20% of business rates. Increasing retail’s burden means less money for investment in jobs, stores, and keeping prices down.”
On Employment Costs:
“The Chancellor has squandered a crucial opportunity to start tackling the growing youth employment crisis. The above-inflation increase in the National Living Wage, combined with the lack of any reduction to employer National Insurance Contributions (NICs), will add further pressure on retail jobs.
“Retailers want to pay colleagues well, but Government cannot ignore the fact that today’s announcement adds another £2 billion on top of the £6.5 billion in additional employment costs that retailers have faced over the last two years. With over 120,000 jobs already lost since 2024, the country cannot afford to wait until the 2027 Budget and the outcomes of the Milburn review for action. The Chancellor needs to make it easier, not harder, to give young people a start. Today, he failed to do that.
“The implementation of the challenging aspects of the Employment Rights Act must not add further cost and complexity and Government’s response to the Milburn review must be deep-rooted and step changing if we are to secure the futures of a million young people not in education, employment or training.”
On Energy Costs:
“While households will welcome action on domestic energy bills, and businesses will welcome the future de-linking of gas and electricity prices, the Budget fell short of what retail businesses need. The industry’s electricity costs are expected to rise by £440 million this year despite almost no change in usage. With non-commodity charges now making up around two-thirds of bills, the Chancellor should have gone further to extend the British Industrial Competitiveness Scheme to retail and its supply chain, and to stop these Government-driven costs finding their way into prices at the checkout.”
On VAT-Free Shopping:
“The UK remains the only major European economy without a tax-free shopping scheme. Analysis has shown that such a scheme could create tens of thousands of new jobs and generate billions in additional tourism spending.”
On Online Marketplaces collecting VAT:
“Retailers welcome measures to ensure VAT is paid fairly and consistently, regardless of where or how goods are sold. However, government must ensure the new rules are practical and do not place unnecessary burdens on businesses that are already complying with their tax obligations.”
On Tariffs:
“While we welcome any action aimed at cutting unnecessary costs and friction for food imports, the announced tariff cuts alone will barely touch the sides in offsetting the rising costs supermarkets face, even on the limited number of products affected.”
