Marks and Spencer’s chief executive Stuart Machin has called for “decisive” action from Jeremey Hunt ahead of tomorrow’s spring budget announcement.
Machin, who has been head of the FTSE 250 company since May last year, urged the government to review the impact legislation has on the retail sector.
“I have never known the burden on retail sit as heavy as it does today,” Machin said on the website Retail Gazette.
One such legislation is corporation tax, which is set to rise to 25% from 19% on 1 April.
Higher tax rates usually deter foreign investment, meaning businesses may move or decide to headquarter elsewhere to pay less tax.
A 25% corporate tax rate is level with what is paid by companies in Austria, Belgium, and Spain, and slightly behind France and Netherlands, where 25.8% of profits were taxed in the last financial year, and Germany, which taxed businesses 29.83%.
Former Prime Minister Boris Johnson has recently called for the corporation tax to be lower than the 12.5% paid by businesses in Ireland.
Grocers such as Marks and Spencer’s have been battling rising grocery inflation, which stood at 13.3% in January according to the British Retail Consortium.
War in Ukraine has strained supplies while recent fruit and veg shortages have been loosely attributed to Brexit, causing prices to balloon.
By and large, however, grocers have successfully mitigated the rising costs of their products, passing them on to consumers with relative ease.
In its half-year report to 1 October 2022, the retailer reported an 8.8% increase in sales to £5.5bn, while post-tax profits rose 4.4% to £166.7mln.
Machin said that the needs government to review its UK apprenticeship levy, which is currently paid at 0.5% of an employer’s annual pay bill.
The CEO also called for greater help to businesses in achieving net-zero goals, including rolling out charging points for electric vehicles and developing on-shore recycling.