Neil Johnston, director of the Northern Ireland Retail Consortium -
“Retailers in Northern Ireland will face a £60 million increase in their tax bill following the announcement that employer national insurance contributions are to rise. Combined with increases in the statutory wage rates it’s clear retail businesses will see big rises in the cost of employment. Stormont ministers need to focus on how they can help business weather these cost increases. These stark increases in national insurance and wages will increase the cost of operating a retail business. They are unlikely to be absorbed by businesses, at a time when footfall and sales are weak, making it likely those costs will be passed along to consumers.
“The update on the economy brought little sunshine. Economic growth is only predicted to rise to two percent at best before easing back, whilst it will be 2029 before inflation returns to beneath the two percent target. That implies little rise in household disposable incomes, further increasing the challenge for retailers looking to grow their businesses.
“Retailers will want to know what Stormont intends to do with business rates. The Executive is going to receive considerable extra finance from Westminster via the Barnett Consequentials. With little fiscal headroom of their own retailers will hope to see action to blunt any rise in business rates. After being thwacked by additional employment costs in the Budget, retailers deserve to be spared any further tax rises in the form of business rates.”
Johnny Hanna, partner in charge of KPMG in Northern Ireland -
“The increase in capital gains tax (CGT) - to 18% from 10% at the lower rate and to 24% from 20% at the higher rate - was not as significant as some had predicted but, when combined with the tightening in inheritance tax rules, particularly the restriction on agricultural and business property relief, the measures have the potential to accelerate business transactions in the short term.”
“The government has not been shy in targeting employers. The hike in the rate of national insurance contributions to 15% from 13.8% and the lowering of the threshold at which it applies, together with the increase in the minimum national wage to £12.21 an hour from £11.44 will have a significant detrimental impact on the wage bills, will still hurt businesses and potentially damage investment in the future.”
Stephen Kelly, chief executive of Manufacturing NI -
“The rise in employers national insurance contributions is a straight up tax on jobs here to fund problems in NHS and other budgets in England. Employers will have to work out how it funds that tax and that could mean halting plans for jobs growth, reducing planned or potential wage rise settlements or perhaps speeding up plans for redundancies particularly in those sectors currently struggling. The government has tried to soften the damage with promises of industrial strategies and investments in things like Made Smarter but as these are devolved areas, these have little importance or value to the Northern Ireland economy.”
Alan Gourley, partner at business advisory firm Grant Thornton NI -
“Many employers will be dismayed by the Budget, with the increase in the rate of employers’ national insurance, reduction in the threshold to which the rate applies, and the increase in the national living wage set to significantly hit the bottom line for a lot of companies.
“But perhaps even more alarming is the seismic impact that the changes to inheritance tax will have on a lot of family businesses. Indeed, Northern Ireland has such a strong culture of retaining companies within the family that these changes will affect this region more than most.
“The tweaks to a few lesser-known rules, such as the reform of both business relief and the ability to pass on agricultural land tax-free, mean businesses need to deal with a major extra exposure to tax.”
Suzanne Wylie, chief executive of the NI Chamber of Commerce and Industry -
“The alarming acceleration of the tax burden on businesses is deeply concerning. In the absence of material growth, this will add to already high business costs and is likely to impact confidence and investment intentions.
“For businesses in Northern Ireland, there are further unknowns. While the additional £1.5 billion in funding for the region is welcome, we need the NI Executive to move promptly to publish its draft budget so that we can start delivering greater certainty for people and businesses here too.
“The Chancellor announced a wide range of initiatives designed to incentivise economic growth across the UK in high growth sectors like defence, aerospace, life sciences and clean energy. We must ensure that Northern Ireland gets its fair share of this.
“The news that the pause in funding for City & Growth Deals in Causeway Coast & Glens and the Mid South West has been lifted is welcome news. So too is confirmation of £270 million for capital investment, which must be directed towards tackling acute infrastructure challenges like wastewater and decarbonisation.”
Glyn Roberts, chief executive of Retail NI -
“This Budget is deeply disappointing, increasing the cost of doing business crisis for local high street businesses. Our members are working people who are struggling to pay the highest business rates in the UK. The decision to add to this burden by increasing employers national insurance will have a negative impact on local jobs, the viability of small businesses and restrict the growth of our economy. This hike along with a 6.7% increase in the Living Wage is a huge cost for local independent retailers to absorb.
“The Chancellor announced a welcome 40% rates relief scheme for independent retailers and other high street businesses in England. It is absolutely vital that the Barnet consequence of this is used locally by the finance minister to provide the same 40% rates relief for our members in Northern Ireland. This will offset the national insurance increase and allow high street businesses to reinvest more of their money to create new jobs and boost our economy.”
Joel Neill, operations director at Hospitality Ulster -
“While our hospitality colleagues in England and Wales are rightly upset at the lowering of the 75% business rates relief to the 40%, hospitality businesses here were never party to this relief. Paired with the Budget’s increase of the national minimum and living wage, increase in employers’ national insurance contributions and decrease in the threshold for those contributions, the Budget has done nothing but increase the cost of doing business for hospitality.
“We all want to see people paid more. Our members want to reward good work and make work pay but what is being asked of businesses is simply unsustainable if taxes are going to shoot up at the same time. Without the extension of rates relief to Northern Ireland’s hospitality businesses or a decrease to VAT, these measures will only threaten employment and businesses in the sector.
“While the cutting of duty on draft alcohol might have raised some cheers in Westminster, the reality is that these savings are unlikely to be passed on to the customer due to the increased cost of doing business. Trying to balance the books from pockets of high street businesses will simply leave hospitality as collateral damage - threatening jobs, future investment, prices increases for consumers, and business viability.”
Alan Lowry, policy chair of the Federation of Small Businesses in Northern Ireland -
“The increase in the employer national insurance contributions will hit many, but we were pleased the Chancellor has taken on board the concerns that FSB has been repeatedly raising and that she simultaneously chose to increase the employment allowance for small businesses. The uplift in this allowance is very welcome, as it more than doubles from £5,000 to £10,500, which will shield the smallest employers from the jobs tax and is therefore a pro-jobs prioritisation in a tough Budget.
“As in previous years, the Chancellor has seen fit to protect small businesses in England from an inflationary hike in business rates by freezing the small business multiplier and extending business rates relief for small firms in retail, hospitality and leisure. Regrettably, the Stormont Executive has consistently failed to pass on this assistance to businesses here, despite having received the funds from Westminster, so we renew our call on local ministers to respond positively this time round.
“Today’s Budget seems to show a direction in business policy for the whole of this Parliament where support will be aimed at smaller businesses rather than big corporates, but where the significant amount of revenue that the government wants to raise will come directly from business.”
