The poll of senior retail finance directors comes as the industry urges the Chancellor to ease the sector’s financial burden in the next Budget.

The survey revealed significant pessimism, with 56% of finance chiefs feeling negative about trading conditions for the coming year. Following recent increases in employer National Insurance and the National Living Wage, two-thirds (65%) expect to raise prices further. The BRC now forecasts food inflation could reach 6% by the end of the year.

The rising costs are also impacting employment and investment. 42% of retailers surveyed have frozen recruitment, while 38% have already reduced in-store job numbers. Official figures reflect this trend, showing almost 100,000 fewer retail jobs in the first quarter of 2025 compared to the previous year.

The primary cause for concern, cited by almost nine in ten (88%) finance directors, is the “tax and regulatory burden”. Helen Dickinson, chief executive of the BRC, noted the industry faces £7 billion in new costs and pays a disproportionate 21% of all business rates, despite accounting for only 5% of the economy. She warned the Chancellor’s choices will either “fan the flames of inflation” or support the high street.

This sentiment was echoed in Scotland, where David Lonsdale of the Scottish Retail Consortium highlighted that recent UK and Scottish government tax changes have added nearly £200 million to Scottish retailers’ annual outgoings. He stated this “ratcheting up of statutory costs” directly harms the viability of stores, staffing levels, and customer prices.