The 1.2% rise in employer National Insurance was among the top concerns of Twickenham’s small business owners following Wednesday’s Autumn Budget.
Raising contributions to 15% will generate an estimated £20billion, part of an overall tax rise the Institute for Fiscal Studies described as the largest-ever as a proportion of GDP.
Habibe Acikgoz, who owns Twickenham high street tailor Habibe London, said National Living Wage and National Insurance increases may be passed onto consumers.
She said: “I may need to charge a higher price, but if you charge a higher price, it is a question of whether people will come back.
“I don’t want to lose my customers because I have built them up over 20 years.”
Acikgoz also said rising contributions make it more difficult to afford hiring new employees.
She said: “I can’t employ people who are starting out, I need to find professional people, so I need to pay them more for their work.”
Elsewhere in Labour’s first budget since 2010, Chancellor Rachel Reeves announced a 40% relief on business rates for the retail industry in 2025/26.
For many retailers, this means an overall cut in relief from the current 75% discount capped at £110,000 per business.
Acikgoz, who started her business in 2003, said: “I think everyone now is doing online sales. They are trying to close all the shops in the future, but I don’t want to.
“They are going to get rid of the shops and every single person is going to do business from home because there is no cost.
“If the government wants to keep shops open on the high street, they have to seriously think about this now, not when it is too late.”
Joe Aston, who owns Frames of Twickenham, was less critical.
He said: “We are 20% up on where we were last year which is positive.
“If the National Insurance increase does affect us, were just going to have to swallow it as a cost of doing business.
“We certainly won’t be changing anything to offset that, it’s just one of those things you have to deal with.
“Obviously it will hit the bottom line, but it’s not going to affect our customers. We wouldn’t pass the cost onto them.”
Responding to the Autumn Budget, Karim Fatehi MBE, CEO of the London Chamber of Commerce and Industry said: “While we support investment in public services, the combined package of increased employer National Insurance Contributions, cuts to business rates relief, and minimum wage increases will create a challenging environment for businesses and curtail their ability to invest or hire new people and, at worst, may see hard-pressed bricks and mortar retailers and hospitality businesses close their doors.”
