The British Retail Consortium has warned that upcoming tax increases could impose an additional £5 billion in costs on retailers, further straining the sector.

As a result of these tax increases, large British businesses are reporting significant layoffs and hiring freezes, which could have lasting impacts on employment.

A recent survey revealed that 36% of 400 UK businesses represented by Helm are either cutting staff or freezing hiring plans due to the financial strain.

AB Foods and Frasers Group have reported weakened consumer confidence, attributing it to the government's budget and economic policies.

Additionally, the tapering off of business rates relief in April adds to the financial strain on the retail, leisure, and hospitality sectors.

Business leaders warn that the tax hike is especially detrimental to sectors with slim margins, such as care services, compounding existing economic challenges.

Despite no new taxes being introduced, many firms had anticipated tax relief measures, such as lower VAT or corporation tax, which ultimately did not materialize.

The U.K. is currently facing economic challenges, including sluggish growth and rising prices, which are further exacerbated by global trade tariffs.

Rachel Reeves' recent Spring Statement has left businesses feeling disheartened as they grapple with ongoing tax hikes stemming from the October Budget.

Small businesses are particularly affected, with many facing the tough decision to raise prices to counteract the increased costs from National Insurance and minimum wage hikes.

The Employers National Insurance rate has risen from 13.8% to 15%, while the secondary threshold for payment has been drastically reduced, adding to financial pressures.

In defense of the tax increases, Reeves stated they were necessary for maintaining public services and finances during an interview with Sky News.