What Jeremy Hunt’s Budget did and didn’t do for British businesses
BUSINESS was underwhelmed by yesterday’s Budget — aimed to appeal to the City.
London stock markets rose and the pound lifted showing the markets were pleased that Jeremy Hunt had been disciplined.
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But British Chambers of Commerce chief Shevaun Haviland said it included no major announcements to help “shift the dial” for firms.
Company chiefs were disappointed their pleas to reduce the business rates burden were ignored once again.
The property tax — set to rise by 6.7 per cent next month — whacks high street chains and gives online retailers an unfair advantage.
Currys boss Alex Baldock called it “bitterly disappointing”.
He complained: “It’s no wonder more stores are having to close their doors.”
Retailers were also furious their campaign to scrap tourist tax on overseas shoppers was ignored.
Some 500 leaders — including bosses from M&S, Primark and Burberry — called on the Chancellor to reinstate tax-free shopping for tourists, claiming it is losing the economy £1.1billion.
Pub chains welcomed the booze duty freeze — but said it would have been more helpful if Mr Hunt had listened to calls to reduce VAT.
Young’s boss Simon Dodd said the Government had “kicked the can down the road rather than implement much-needed long-term support for the hospitality sector”.
But shares in his company — and in Weatherspoons and Marston’s — rose.
The car industry complained about lack of support to stimulate electric vehicle demand amid falling sales.
It wanted lower VAT on electric motors and public charging points to make them more affordable.
But it got nothing.
Vauxhall said the Budget had not “delivered the acceleration needed to stop the UK’s transition to electric vehicles from stalling”.
But the Chancellor gave handouts to the arts sector which recently provided an economic boost.
He singled out stars Idris Elba, Orlando Bloom and Keira Knightley currently filming in the UK.
He announced rates relief for film studios, theatres, and museums — with £26.4million for the National Theatre.
The Chancellor surprisingly raised the threshold for small firms having to register VAT from £85,000 to £90,000.
But tax experts branded the changes miniscule, pointing out the UK still has the highest threshold in Europe.
Michelle Liu, who runs Chinese takeaway Mama Chen’s’ in Romford, East London, thinks a hike to £100,000 would have been more helpful.
She said: “While this is a move in the right direction it will help relatively few small and medium-sized businesses.”
Meanwhile, the Chancellor confirmed plans to launch a British ISA — and a new exchange for private companies to trade their shares.
The moves aim to make it easier for firms here to get support from UK investors.
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BRICKS FALL OFF
BRICKMAKER Ibstock saw profits slump by 71 per cent after costs increased and house building slowed.
They axed 300 jobs — 15 per cent of its force — and shut two factories to save costs.
Annual profits fell from £105million to £30million and sales dropped from £513million to £406million.
Boss Joe Hudson said there is “significant unmet demand for new build housing” but subdued demand from developers.
Figures show new house building work rose for the first time since July 2023.
RETAIL PAY RISES
SO-CALLED ethical retailers John Lewis and Co-op yesterday played catch-up with their rivals in boosting wages.
John Lewis has increased the minimum wage for its department store staff and Waitrose workers by ten per cent to £11.55 an hour.
In London the rate will go up to £12.89.
The Co-op, meanwhile, has announced it will boost minimum pay to £12 an hour, and to £13.15 in London.
Both retailers are trailing their rivals. Asda pays £12.04 an hour and Tesco £12.02, with higher rates in London.
THE maker of Vimto expects to sell 25 million bottles of the fruity drink during Ramadan.
NicholsI, which also owns Slush Puppie treats, reported sales rose by 3.5 per cent to £170.7million while profits were boosted by 75 per cent to £24.3million.
888 CALLS TIME ON US DREAM
WILLIAM HILL owner 888 has admitted defeat and is retreating from the US after bosses realised that a lot more money would be required if it was to become profitable.
Boss Per Widerström said 888 had come up against intense competition from the likes of Fan Duel and Draft King and said the “requirement for scale means huge investment is required”.
He said it was unlikely it could grow its US business fast enough and would update investors next month.
As a result, 888 is cutting ties with the owner of Sports Illustrated magazine’s owner, which had allowed it to use its brand in the US for online sports betting and casinos.
888 will have to pay a total of £40million over the next five years as the cost of getting out of the deal.
However, the business said it would save around £5million this year and next.
CAPITA’S BIG LOSS
TROUBLED outsourcer Capita suffered another big hit yesterday after shares dropped a fifth on huge losses.
The outsourcer, which provides software and IT resources, suffered a cyber attack last March which compromised more than half a million peoples’ data.
The firm reported a £106.6million loss after £61.4million of profits the year before.
Chief Adolfo Hernandez said it will make a “rapid reduction” in costs.
