UK Business Confidence Hits Lowest Level Since Pandemic Following Budget Tax Hikes

Chancellor Rachel Reeves faces criticism as tax increases erode corporate optimism, investment plans, and hiring intentions.

Business confidence in the UK has dropped to its lowest point since the early months of the COVID-19 pandemic, according to surveys by the Institute of Directors (IoD) and other organizations.
Chancellor Rachel Reeves's budget introduced £40 billion in tax increases, including a £25 billion rise in employer National Insurance contributions, which businesses say are straining growth and forcing cost-cutting measures.
Surveys indicate widespread concerns about reduced hiring, smaller pay raises, and cutbacks in investment, with many firms reporting a more negative outlook for 2025.
The Confederation of British Industry (CBI) and other groups warn the tax measures could lead to significant job losses and reduced economic activity in the coming years.
While some businesses remain optimistic about their individual trading prospects, confidence in the broader UK economy and government economic policies has sharply declined.