UK businesses warn of growth risks ahead of upcoming Budget

UK business leaders and small enterprises are expressing significant concern regarding potential tax increases in the upcoming Budget. Rain Newton-Smith, Chief Executive of the CBI, warned that imposing further tax burdens on the financial services sector would be an ‘own goal for competitiveness,’ noting that the industry already faces higher taxes than other global hubs.

Newton-Smith emphasized that the financial sector supports over 650,000 jobs outside of London and contributes more than £200 billion annually to the UK economy. She urged the government to provide breathing space for businesses to invest and hire rather than penalizing thriving sectors.

Simultaneously, research from Novuna Business Finance indicates that 86% of small businesses fear Budget announcements that could damage their growth outlook. Key concerns among small business owners include potential rises in employer National Insurance, VAT, income tax, and corporation tax, as well as increases in fuel duty and business rates. The data reflects a cautious economic mood, with only 26% of small businesses forecasting growth for the final quarter of 2026.