How will the UK Budget affect small businesses?

The Budget is expected to increase costs for small businesses due to higher minimum wages and dividend taxes, potentially leading to price increases for consumers.

What are the main concerns for entrepreneurs after the Autumn Budget?

Entrepreneurs are worried about increased operational costs, reduced attractiveness of investing in their own businesses due to dividend tax hikes, and a potential decrease in consumer spending.

Are there any benefits for small businesses in the new Budget?

Yes, the Budget offers free training for apprentices under 25 and permanent reductions in business rates for many retail, hospitality, and leisure companies.

Home / Business and Economy / Budget Hits Small Firms: Costs Surge Despite Tax Relief

Budget Hits Small Firms: Costs Surge Despite Tax Relief

27 Nov

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Summary

Minimum wage hike and dividend tax increase raise employer costs.
Small firms warn of price rises due to new budgetary measures.
Apprentice training incentives offered, but overall burden grows.

Budget Hits Small Firms: Costs Surge Despite Tax Relief

The recent Autumn Budget has sparked significant concern among small businesses, who anticipate higher operational costs despite the Chancellor's attempts to offer support. Measures such as increased minimum wage rates and a two percentage point rise in dividend taxes are poised to place a substantial burden on employers. While training incentives for young apprentices are available for SMEs, many entrepreneurs feel these benefits are overshadowed by the escalating expenses.

Business owners are voicing apprehension that these increased costs will inevitably be passed on to consumers through higher prices. This is particularly concerning for labor-intensive sectors like hospitality and retail, which are already grappling with rising overheads. The Federation of Small Businesses has criticized the dividend tax increase, stating it makes investment in one's own business less tax-friendly.