Labour's Budget tax bomb will hit growth, investment and jobs, business chiefs warn

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News,Labour,Rachel Reeves

The CBI says that the £25billion National Insurance raid has pushed industries such as retail and hospitality into 'crisis containment' while other sectors are now focusing on 'damage control'.

The employers' organisation says that the £25billion National Insurance raid has directly undermined the Chancellor's stated aim of boosting economic growth.

'Profits aren't just extra money for companies to stuff in a pillowcase,' she will say. 'Profits are investment. When you hit profits, you hit competitiveness, you hit investment, you hit growth.' Ms Newton-Smith said business had been 'caught off guard' by the scale of the changes to employers' NI.CBI chief executive Rain Newton-Smith will say in a speech today that worst-hit industries such as retail and hospitality have been pushed into 'crisis containment', and that growth is impossible unless businesses are allowed to prosper

But the Office for Budget Responsibility downgraded its growth forecasts for the final years of the decade in the wake of the Budget. Official figures covering the first three months of Labour's tenure show growth fell to 0.1 per cent, down from 0.5 per cent the previous quarter. 'Even where the risk isn't critical, firms that have been through really tough years are now in damage control again. They are looking with heavy hearts to cut training and investment, delay decarbonisation projects, or pass on costs to customers.'

A survey of CBI members found that half are now looking to cut jobs, while two-thirds are slashing pre-Budget recruitment plans

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CBI Warns Labour's Budget Tax Hikes Will Damage Growth, Investment, and JobsThe Confederation of British Industry (CBI) is set to warn that Labour's budget tax increases will negatively impact economic growth, investment, and job creation. CBI chief executive Rain Newton-Smith will argue that the £25 billion National Insurance rise undermines the chancellor's goal of boosting the economy and has forced businesses, particularly in retail and hospitality, into 'crisis containment'.
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