30 Oct 2024
Business groups have reacted to Chancellor Rachel Reeves' Autumn Budget speech.
The Confederation of British Industry (CBI) said that the Chancellor 'had difficult choices to make to deliver stability for the economy'.
Rain Newton-Smith, Chief Executive of the CBI, commented: 'A more balanced approach to our fiscal rules which prioritises capital investment should help to unlock private sector investment in our infrastructure and net zero transition over the long-term.
'While the Corporation Tax Roadmap will help create much needed stability, the hike in National Insurance contributions (NICs) alongside other increases to the employer cost base will increase the burden on business and hit the ability to invest and ultimately make it more expensive to hire people or give pay rises.'
Meanwhile, Shevaun Haviland, Director General of the British Chambers of Commerce (BCC), labelled the fiscal event a 'tough Budget for business'. She continued: 'While some protection for smaller firms is welcome, the increase in employer NICs will place a further cost burden on business. This, coupled with a 6.7% increase in the National Living Wage (NLW) means many firms will find it more challenging to invest and recruit in the short-term.
'But the Chancellor has looked to offset the upfront hit on firms by outlining a longer-term framework to provide stability for the economy.'
The Institute of Directors (IoD) branded the Autumn Budget as offering 'short-term pain for the business community'. Roger Barker, Director of Policy at the IoD, said: 'The government has chosen to impose a significant new tax burden on business as a means of achieving an immediate boost to its public sector spending priorities. The risk is that this will exert a negative impact on business confidence, with worrying implications for the economy's future growth trajectory.'