Business confidence late last year stooped to its lowest level since the fallout of Liz Truss’ mini-Budget as firms looked to tax hikes by chancellor Rachel Reeves.
Accountancy body ICAEW’s business confidence monitor showed a reading of 0.2 for the final quarter of 2024, against 14.4 in the previous three months.
Sentiment among businesses had hit its lowest since the final quarter of 2022 as a result, driven by muted sales and looming tax increases unveiled by Reeves in October’s Budget.
“Our data suggests that the UK economy endured a rather traumatic end to 2024,” ICAEW economics director Suren Thiru commented.
“Slowing domestic activity and the aftershocks from a difficult Budget caused business confidence to nosedive.”
Reeves had announced a higher rate and lower threshold for employer national insurance in the Budget, landing businesses with a £25 billion tax hike from April.
ICAEW chief executive Alan Vallance noted there was “little surprise” over the drop, given the “costs of October’s Budget fell almost solely on business”.