M&S chief executive Stuart Machin has admitted he was “disappointed” following the Budget last week, and the lack of clarity around business rate reform.

Among the changes set out by Chancellor Rachel Reeves last week is a permanent lowering of business rates for retail, hospitality and leisure properties from 2026/27.

Machin explained: “We were hoping for some good news on business rates. Retail is 5% of the economy and pays 21% of rates.

“If you look at last year, we paid £170m, so although there was some recognition that retail and hospitality should pay less, I was disappointed that it’s unclear what that will be and the impacts of that, and that’s been kicked into 2026.

“Likewise, there was nothing about the apprenticeship levy reform, which I thought there would have been.”

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He added the “double whammy” of National Insurance Contributions not only increasing but the pay threshold at which employers have to pay the tax would add an additional £60m to M&S’ tax bill.

“We knew there would be an increase, we didn’t quite realise the threshold as well as the increase would impact us. If you take that one thing in totality for us, that’s around £60m of headwind as think about next year.”

From April 2025, Employers’ National Insurance Contributions will rise from 13.8% to 15% on a worker’s earnings above £175, while the threshold at which employers start paying the tax on each employee’s salary will be reduced from £9,100 per year to £5,000.

“If you look at our tax, national insurance last year was around £180m, business rates £170m, corporation tax £180m. Our total bill last year was £460m and another £60m on top of that with the new increase in National Insurance Contributions,” the M&S boss added.

Within the Budget announcements last week, the Chancellor also unveiled the end of 100% inheritance tax relief on farms and agricultural properties valued above £1m. Instead, from 6 April 2026, properties above the threshold will now only be offered 50% relief.

It’s a move which has left many in the sector unhappy as National Farmers Union president Tom Bradshaw said: “This Budget not only threatens family farms but will also make producing food more expensive. This means more cost for farmers who simply cannot absorb it, and it will have to be borne by someone. Farmers are down to the bone and gristle, who is going to carry these costs?”

Machin added: “Farmers have a pretty tough job. We’re working very closely with our farmers, we’ve got a good track record of lots of British products. We’ll support them in any way we can.”

It comes as M&S first-half profits surged on the back of growing food sales as the grocer continues its strategy to be the “most trusted retailer”.