Recent Budget announcements have raised concerns for Marks & Spencer due to unclear business rate reforms.
- M&S CEO, Stuart Machin, expressed disappointment over the ambiguity in the latest fiscal measures outlined.
- There is a focus on the impact of National Insurance Contributions increases, affecting the company’s financial planning.
- The Budget’s failure to address apprenticeship levy reforms also drew criticism from retail leaders.
- Changes to inheritance tax relief on agricultural properties are prompting concern among farmers.
The recent Budget has left Marks & Spencer’s CEO, Stuart Machin, voicing his disappointment, particularly regarding the uncertain effects of business rate reforms. The Chancellor’s proposal to permanently reduce business rates for retail, hospitality, and leisure properties from 2026 marks a key change. However, the lack of clear implications for these changes remains a significant concern. Machin highlights that while retail contributes 5% to the economy, it carries a disproportionately high share of 21% in business rates. Despite some acknowledgment of the need for reduced rates in retail and hospitality, specific impacts and details remain unclear, resulting in his expression of dissatisfaction.
In addition to business rates, the increase in National Insurance Contributions presents a financial challenge for M&S. From April 2025, the rate will rise from 13.8% to 15% on earnings above £175, while the threshold for employer contributions will drop from £9,100 to £5,000. This adjustment is estimated to add £60 million to M&S’s tax obligations, further complicating their fiscal planning. Machin noted that their previous year’s total tax bill amounted to £460 million, emphasising the scale of the new financial pressure.
Moreover, Machin expressed concerns over the absence of reforms in the apprenticeship levy, which was unexpected. The lack of developments in this area is seen as a missed opportunity for supporting workforce development, vital for business growth.
Another significant change unveiled in the Budget is the reduction of inheritance tax relief on agricultural properties valued above £1 million. Effective from April 2026, the relief will decrease from 100% to 50%, raising alarm within the farming sector. National Farmers Union president, Tom Bradshaw, voiced apprehension, stating the move threatens family farms and elevates the cost of food production. Machin reiterated support for farmers, affirming Marks & Spencer’s commitment to working closely with them.
The recent Budget announcements have sparked significant concern across multiple sectors, underscoring the need for greater clarity and support.
