Retailers have warned the business rates hike in the next Budget may force them to raise prices, pause hiring, and lay off employees, according to new figures from the British Retail Consortium (BRC).

Almost nine-in-ten (85%) of chief financial executives claimed the last Budget’s increase in national insurance fees and minimum living wage forced them to raise prices. Meanwhile, one in six (15%) said the higher rates led to a delay in expanding with new stores.

Additionally, retail bosses expect the situation to worsen, with 65% projecting further price increases in the upcoming year. The BRC predicted that food inflation will jump from 4% in July to around 6% by the end of the year.

Retail employment also took a hit, with 42% of CFOs pausing hiring and 38% reducing their number of in-store employees. There were also 100,000 fewer retail jobs in the first quarter of 2025 compared to 2024.

Helen Dickinson, CEO at the BRC, said: “Retail was squarely in the firing line of the last Budget, with the industry hit by £7 billion in new costs and taxes. Retailers have done everything they can to shield their customers from higher costs, but given their slim margins and the rising cost of employing staff, price rises were inevitable.

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“The consequences are now being felt by households as many struggle to cope with the rising cost of their weekly shop. It is up to the Chancellor to decide whether to fan the flames of inflation or to support the everyday economy by backing the high street and the local jobs they provide.”

The poll also revealed 88% of retail executives expressed worry over the “tax and regulatory burden” that will come with higher national insurance, business rates, living wages, and the new packaging tax.

Major retailers, including M&S and Ocado, have criticised the proposed changes and urged the Government to consider the inflationary impact from the new regulations.

Dickinson added: “Retail accounts for 5% of the economy yet currently pays 7.4% of business taxes and a whopping 21% of all business rates. It is vital the upcoming reforms offer a meaningful reduction in retailers’ rates bill and ensure no store pays more as a result of the changes.

“If instead, the Chancellor chooses to add further costs to retailers and high streets, it will be the British public who suffer from the knock-on impact on inflation.”