5<\/p>\n Business chiefs have warned of a high street bloodbath as Labour\u2019s \u00a325bn tax bomb comes into effectCredit: Getty<\/p>\n Writing in today\u2019s Sun on Sunday, Iceland<\/a> boss Richard Walker tells Ms Reeves: \u201cWe do not have bottomless reserves of cash put aside in a piggy bank for the Government to draw on.\u201d<\/p>\n From today, businesses have to pay a higher rate of employer National Insurance Contributions<\/a> \u2014 15 per cent, up from 13.8 per cent.<\/p>\n And the wage threshold at which they are paid has been lowered from \u00a39,100 to \u00a35,000.<\/p>\n Mr Walker warned there will be dire consequences for small businesses unable to absorb costs.<\/p>\n An increase to the National Living Wage<\/a> last week also heaped pressure on companies.<\/p>\n It comes as British exporters were dealt a hammer blow by Donald Trump\u2019s US trade tariffs \u2014 against a backdrop of downgraded growth forecasts and rising bills<\/a>.<\/p>\n A new survey by the Federation of Small Businesses (FSB) found 51 per cent of firms saw their revenue fall across the first quarter of this year, and 40 per cent are braced for their revenue to decrease.<\/p>\n Meanwhile, the British Beer and Pub Association predicts the NICs rise will cost pubs<\/a> \u00a3180million \u2014 or \u00a34,000 per pub.<\/p>\n Association boss Emma McClarkin said: \u201cWith six pubs closing a week on average and making just pennies on a pint, they simply don\u2019t have the luxury<\/a> of absorbing yet more fees \u2014 including soaring employment<\/a> costs.<\/p>\n \u201cGovernment must phase in these employment costs as they will dent business<\/a> which, ultimately, hurts working people.\u201d<\/p>\n Rachel Reeves is a fiscal fantasist of the highest order\u2026 there are only four things that will grow under her policies<\/p>\n Shadow Chancellor Mel Stride<\/a> said the NICs hike<\/a> will be the \u201cfinal nail in the coffin\u201d for many British pubs.<\/p>\n The Tory added: \u201cPubs, restaurants<\/a>, and low-wage sectors are facing job cuts, higher costs and reduced growth, having already been clobbered with a 140 per cent rise in business rates.<\/p>\n \u201cThe Chancellor\u2019s reckless anti-business jobs<\/a> tax will cost pubs \u00a34,000 on average, threatening their future everywhere.\u201d<\/p>\n Bosses are now begging Labour to water down its controversial workers\u2019 rights plan, which will hand sweeping powers to unions and stifle business.<\/p>\n Shevaun Haviland, of the British Chambers of Commerce, said the Employment Rights Bill \u201crisks unintended consequences\u201d. And Tina McKenzie, of the FSB, said it will \u201chold back job creation\u201d.<\/p>\n UKHospitality estimates the new NICs changes<\/a> will cost the sector \u00a31billion. And that is only part of a total \u00a33.4billion cost to the industry from other increases this month.<\/p>\n If the Government wants to see hospitality lead from the front in delivering economic growth and creating jobs, it should rethink these regressive tax increases.<\/p>\n Kate Nicholls, chief executive of UKHospitality<\/p><\/blockquote>\n It says 774,000 hospitality workers will be sucked into employer NICs for the first time \u2014 a fifth of the entire sector\u2019s workforce.<\/p>\n And 70 per cent of hospitality business<\/a> leaders think they will be forced to reduce employment levels.<\/p>\n Meanwhile, 60 per cent expect to cancel planned investment and 15 per cent believe they will have to close at least one site.<\/p>\n Kate Nicholls, chief executive of UKHospitality, said: \u201cThese damaging tax rises will be almost immediately felt by consumers, through an increased price of a pint or a meal, and by hard-working staff who will see hours likely reduced.<\/p>\n \u201cIf the Government<\/a> wants to see hospitality lead from the front in delivering economic growth and creating jobs, it should rethink these regressive tax increases.\u201d<\/p>\n Make UK, which represents manufacturers, did a survey that found almost half of companies are freezing recruitment and four in ten will reduce pay increases.<\/p>\n Around a quarter are considering redundancies and a third are delaying investment plans.<\/p>\n The British Retail Consortium<\/a> estimates the higher National Living Wage and changes to NICs will cost the industry more than \u00a35billion a year, rising to \u00a37billion when a new packaging tax comes into force in October.<\/p>\n Consortium chief executive Helen Dickinson said: \u201cThese additional costs mean higher prices, fewer jobs and fewer stores.<\/p>\n \u201cA recent survey of retail finance directors showed half were planning to reduce hours and workers as a direct result of NICs.\u201d<\/p>\n Double blow<\/p>\n The British Chambers of Commerce found most firms surveyed are expecting to put up their prices over the next three months.<\/p>\n A small manufacturing firm in Essex<\/a> told them tax and costs had caused it to shelve expansion plans for the next five years.<\/p>\n And a medium-sized construction company in Manchester<\/a> said the NICs increase will add \u00a3110,000 to its pay bill this year alone.<\/p>\n A logistic firm in Aberdeen said the NICs increase will reduce its profits by 25 per cent.<\/p>\n Ms Haviland, director-general of the BCC, said: \u201cThe National Insurance<\/a> rise has been an impending concern for months. From this weekend, it will become a toxic reality for millions of businesses.\u201d<\/p>\n Britain\u2019s car industry faces a double blow, with a 25 per cent US tariff on exports and a \u00a3200million-a-year NICs increase, according to Tory analysis.<\/p>\n They say it will leave the UK car industry<\/a> \u00a32.1billion worse off every year.<\/p>\n Businesses are now bracing themselves for further tax rises in the autumn<\/a> amid fears the US trade tariffs have wiped out the Chancellor\u2019s economic options.<\/p>\n A Government spokesman said: \u201cWe are pro-business and we know the vital importance of small businesses to our economy.<\/p>\n “We delivered a once-in-a-Parliament Budget that took necessary decisions on tax to stabilise the public finances.\u201d<\/p>\n CARE BOSS 5<\/p>\n Mike Padgham, executive chairman of Saint Cecilia\u2019s Care GroupCredit: Glen Minikin<\/p>\n MIKE Padgham, executive chairman of Saint Cecilia\u2019s Care Group, warned that NI and minimum wage hikes will pile pressure on the NHS<\/a>.<\/p>\n He said it could lead to an increase in bed blocking \u2014 where people stay in hospital for longer due to a lack of care options.<\/p>\n Mike added: “This is a serious blow for a sector already reeling from years of underfunding and Covid<\/a>. I expect there will be some business failures.<\/p>\n \u201cIf social care isn\u2019t out there in the community then people who are medically fit for discharge and want to go back to their own home or care homes<\/a> will be unable to.<\/p>\n “This adds to the pressure on the NHS \u2014 an unintended consequence of this policy.\u201d<\/p>\n YOUNG WORKERS 5<\/p>\n Lucy Laycock, 18, works part time on a zero hours contract at a luxury hotelCredit: NNP<\/p>\n YOUNG workers fear losing their jobs due to the impact of tax hikes<\/a> on employers.<\/p>\n As well as being a student, Lucy Laycock, 18, works part time on a zero hours contract at luxury hotel Grantley Hall in North Yorkshire<\/a>.<\/p>\n She said: \u201cIt will impact young people a lot, especially those on zero hour contracts.<\/p>\n \u201cIt\u2019s really scary to think that we could be let go.\u201d<\/p>\n Harry Jones, 23, who is a history student from Northumbria, works part-time at Primark<\/a>. Harry said: \u201cIt makes sense that some businesses will start getting rid of staff to foot the bill. It is a worry.\u201d<\/p>\n HOTEL BOSS 5<\/p>\n Eddie Nelder, director of Choice Hotels, says Labour are ‘killing tourist resorts’Credit: PP.<\/p>\n EDDIE Nelder, director of Choice Hotels, believes the Government\u2019s policies<\/a> are \u201ckilling tourist resorts\u201d.<\/p>\n His chain has three hotels in Blackpool<\/a> and two in the Lake District, employing 400 staff.<\/p>\n He said: \u201cHospitality businesses are being strangled by the Chancellor Rachel Reeves\u2019 and Angela Rayner\u2019s policies\u201d.<\/p>\n He said Blackpool has a \u201cforward-thinking council\u201d and bookings are high, yet the industry is being strangled by tax hikes <\/a>and NI against a backdrop of wafer thin margins and holidaymakers who can\u2019t afford price increases.<\/p>\n Eddie, right, added: \u201cIt\u2019s the same picture across seaside resorts in Britain.<\/p>\n “There are devastating implications for the wider economy. Reeves and Rayner say they have spoken to hundreds of businesses \u2014 well they have not spoken to me or anyone I know in Blackpool.<\/p>\n “The Government needs to help UK hospitality and hotels.\u201d<\/p>\n HOSPITALITY BOSSES 5<\/p>\n Jason Barr, owner of Blackpool\u2019s Retro LoungeCredit: supplied<\/p>\n HOSPITALITY<\/a> bosses sounded the alarm on the economy \u2014 warning: \u201cIf too many businesses go down the pan we\u2019re all in trouble.\u201d<\/p>\n Jason Barr, 51, owner of Blackpool\u2019s Retro Lounge, said he plans to open five days a week instead of seven due to the hikes but feels it is inevitable some businesses will fold<\/a>.<\/p>\n He said: \u201cThe Government needs to remember if we work together, we win together.<\/p>\n \u201cBut the opposite is also the case \u2014 if too many businesses go down the pan we\u2019re all in trouble.\u201d<\/p>\n![\"Motion-blurred](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/04\/crowd-motion-blurred-shoppers-busy-792164065.jpg\")
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