Tesco chief executive Ken Murphy has delivered a blunt warning to the Chancellor, urging Rachel Reeves not to impose fresh tax burdens on Britain’s retailers in next month’s autumn budget.
Speaking after a year in which Reeves’s maiden budget raised employers’ national insurance contributions and the minimum wage — measures that added more than £7bn in costs across the sector — Murphy said the industry was “doing its best” to absorb the pressure but insisted: “Enough is enough. Don’t make it harder for the industry to deliver great value for customers.”
Tesco alone expects its employment bill to rise by £1bn over the next four years because of the changes. Murphy called instead for “pro-growth, pro-jobs” policies and repeated demands for large retailers to be excluded from the higher band of business rates under government reforms.
The government has scheduled its budget for 26 November, unusually late in the retail calendar. Industry leaders warn the timing could dampen consumer confidence just as Black Friday and Christmas shopping begin.
Murphy said households were “worried about what lies ahead”, pointing to falling consumer sentiment driven by fears of higher taxes.
Other large retailers echoed the concern. The boss of a nationwide clothing chain said the delay was already “negatively affecting consumer confidence”, while another warned that holding the budget just two days before Black Friday risks shoppers pulling back, even amid heavy discounting.
Clive Black of broker Shore Capital said many executives felt the government treated business “as a money tree”, despite “waste and productivity collapse” in the public sector. The British Retail Consortium added that late changes created uncertainty, making it harder for companies to plan investment in jobs and stores.
The Treasury defended the timing, saying it fell within the normal range and that the Office for Budget Responsibility requires at least ten weeks to prepare its forecast. A spokesperson pointed to new trade deals with the EU, US and India, alongside reforms to business rates and a corporation tax cap, as evidence of pro-business measures.
For retailers, however, the looming budget raises the prospect of higher costs colliding with a critical sales period, testing both margins and consumer appetite at the most important time of the year.
