Tax hikes triggering record low in business confidence

Rachel Reeves is facing a double whammy of economic blows as employers warn of the dire impact of her Budget tax hikes.

- KATE DEVLIN

The number of companies planning to make staff redundant has reached its highest level in a decade outside the Covid pandemic, according to a new survey. Meanwhile, confidence among small businesses has hit a new record low.

Critics said the findings show the tax raids were "a millstone" around the neck of the economy, while business leaders said the government "urgently" needs to push for economic growth.

Ms Reeves's national insurance hike has prompted widespread plans to increase redundancies and cut hiring, the Chartered Institute of Personnel and Development (CIPD) said.

A survey of more than 2,000 employers by the organisation found nine in 10 businesses expect their employment costs to rise. Of these, a third said they plan to reduce staff through redundancies or recruiting fewer workers - and two in five warned they will raise prices.