More than eight in 10 UK adults are worried about inflation and prices going into the Autumn Budget, according to polling for the British Retail Consortium (BRC). The trade body is using the findings to urge Chancellor John Healey to provide relief on business rates and employer National Insurance.
The Opinium survey of 2,050 UK adults found that 82% were very or fairly concerned about inflation. The polling follows the BRC’s latest Shop Price Monitor, which put shop price inflation at 2.1% in October, the highest rate since February 2024. The rate has been rising since the summer, from 0.9% in July to 1.5% in August.
Official figures show that the Consumer Price Index (CPI) rose to 3.5% in September from 3.1% in August, its highest level since October 2025, with motor fuels the biggest upward driver. Clothing and footwear inflation stood at just 0.1%, likely due to fashion retailers discounting heavily to clear seasonal stock over the summer. The BRC had also said in August that retailers had kept clothing prices low ahead of the new school year.
The following month, September, total retail sales were up 1.3% and non-food up only 0.3%, with clothing and footwear weak during unseasonably warm weather. Barclays data showed clothing spending down 1.3% despite a 3.8% rise in transaction volumes.
Consumer expectations for the economy also fell to minus 40 from minus 34 in October, according to the BRC’s consumer sentiment survey. Expectations for personal finances also dropped to minus 18 from minus 15, while expected retail spending rose to 15 from five as the three-month outlook began to cover Christmas.
Retail faces £250 million rates rise in April
The BRC said rising taxes have made it “all but impossible” for retailers to keep absorbing costs, with the industry now facing £41 billion in business taxes for 2026/27, a 20% increase in two years.
Analysis by Flint Global for the BRC put retail’s effective tax rate at 71.5% in 2025/26. That was the second highest of 11 major sectors after hospitality, against an average of 50% and 40.5% for banking.
Without intervention, business rates will rise by 3.5% in April 2027, in line with September CPI. Retail already pays a fifth of UK business rates, and the increase would add around £250 million to its costs.
Meanwhile, employment costs have risen by £6.5 billion over two years. More than £2 billion of that came from changes to the employer National Insurance Contributions (NICs) rate and threshold. Over the same period, 122,000 retail jobs have been lost.
The BRC and its members are asking the Chancellor to:
- raise the employer NIC threshold from £5,000 to £6,000.
- freeze the CPI-linked increase in business rates.
- exempt retail premises from the high-value multiplier.
Helen Dickinson, Chief Executive of the BRC, said: “The message from the public is clear: the cost of living remains a top concern. Households, retailers and the Government share a common aim of easing pressure on family finances and fixing the youth employment crisis. The Budget must deliver on both.
“To support this, the Chancellor must address the barrage of costs and taxes currently raining down on the industry. Every pound spent on taxes and regulation is a pound not spent on keeping prices low for consumers.
“Action on business rates and NICs would go a long way to helping retailers deliver even better value for households and more jobs for young people. A Budget for shops and shoppers is also a Budget for communities everywhere.”
Youth jobs pledge under pressure
The BRC also argues that costs are limiting the sector’s ability to hire young people. One in five people start their career in retail, and there are nearly one million young people not in employment, education or training (NEET).
In September, the industry pledged to create 100,000 jobs for NEETs by the end of this parliament. More than 40 retailers, including AllSaints, JD Sports, Primark and New Look, committed 11,305 placements to the Opening Shift work-experience scheme run with the Department for Work and Pensions.
Healey had planned to meet retail and hospitality executives for pre-Budget talks on 13 October, with bosses from Sainsbury’s, Marks & Spencer and Tesco among those invited.