The biggest supermarkets in the UK could pay an additional £200m in National Insurance contributions collectively as the Chancellor is set to outline a hike in the Budget today (30 October).

It is understood that Tesco, Sainsbury’s, Asda and Morrisons could be hit with the incremental tax bill from a two-percentage point increase in employer National Insurance contributions, Sky News reported.

One analyst estimated that Tesco, which has around 300,000 employees in the UK, could face £75m added to its bill.

Last week, M&S chief executive Stuart Machin warned the government that raising business taxes in the October Budget is a “short-term, easy fix” that will make “economic recovery harder”, and cautioned Chancellor Rachel Reeves that “hiking taxes” will have a knock-on effect for UK consumers.

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Machin said: “When I hear about plans to increase National Insurance, a tax with no link to profit which hits bigger employers like us and our smaller suppliers, I’m concerned.

“The Chancellor was right in the past to call National Insurance a tax on workers – it makes it more difficult to offer the life changing opportunity of a job. Particularly if you hike other tax that hit retailers, like business rates or fuel duty.”

It comes as retailers are also set to face a rise in wage bills as Reeves confirmed that minimum wage would increase 6.7% while the National Living Wage will increase 6% from £11.44 to £12.21 an hour from April 2025.

The minimum wage for 18 to 20-year-olds will go up by £1.40 per hour to £10.

Usdaw general secretary Paddy Lillis said that the union for shopworkers “very much welcomes these significant pay increases for the lowest paid”.

“We are pleased that Labour’s new remit for the Low Pay Commission has resulted in progress towards delivering a statutory real living wage and started on the road to ending rip-off youth rates.”