BBCMeghan OwenLondon work and money correspondent, Seven Dials
Businesses across London have been reacting to the measures announced by Chancellor Rachel Reeves in Wednesday’s Budobtain.
One of the largegest talking points is that the lowest-paid workers will obtain higher wages from April. Those aged 18-20 will see the minimum wage rise 85p to £10.85 and over-21s will be paid £12.71, up 50p.
Businesses operating in properties valued above £500,000 will pay higher business rates, which is one of the concerns raised by companies operating in the West End.
Ros Morgan, Heart of London Business Alliance’s chief executive, stated: “The reality is businesses have been hit really hard so with the wages increase, the National Insurance (NI) increase and now the business rates increase, it’s a triple whammy.”
‘Very frustrated’
She added: “There has to be a breaking point and this might be it. That’s not to declare that businesses don’t want to pay the proper wages.
“My experience with every business I speak to, all the members that I represent, is they all want good people and they’re willing to pay good money for that but if they also have to pay these higher business rates, which are… astronomical you could declare, then something has to give.
“My concern is that they will pautilize recruitment even further than what they have whenever the National Insurance hike was introduced.”
Mouna Elkekhia, who runs Mouna’s Kitchen offering Middle Eastern street food, stated the Budobtain had left her “feeling extremely disappointed” and “very frustrated”.
She stated: “We took part in a campaign where we built it very clear what, as a sector, we requireded to be able to survive and I just feel like the government heard us and ignored us again.
“There are key things that they could do to support us reduce our costs and they’ve chosen to ignore all of those and have just put in place kind of piecemeal things that really won’t create a difference to us.”
Alice Di Chiara, the owner of Mezzo in Seven Dials, stated support for compact businesses was lacking from this government.
“Obviously, the largegest disappointment is the missing opportunity in lowering the VAT rates for hospitality, which is I believe what everybody was kind of hoping for,” she notified the BBC.
“Raising the NI was really impactful for us becautilize we had to add that into the costs for all our staff, even the ones that work like less hours, and same for the minimum wage last year.”
The Night Time Industries Association branded the Budobtain a “hammer-blow to the already fragile night-time economy” and stated the minimum wage increase “presents a serious challenge for a sector that employs a large proportion of young people”.
Chief executive Michael Kill stated: “Many venues are already operating on the edge, and we will inevitably see businesses handing back their keys by January, when VAT, quarterly rent payments and other financial obligations collide.
“The pressure on both operators and consumers is now completely unsustainable.”
Tourist tax
As well as praising the minimum wage rise, the mayor of London welcomed the ability to raise up to £250m a year by charging visitors staying in London overnight.
Sir Sadiq Khan notified BBC London: “I’m going to work really closely with those in hospitality, those in tourism, those in the business community and with our councils to obtain the best possible scheme in terms of a tourism levy.”
However, Antonia Jennings, chief executive of the indepconcludeent believe tank Centre for London, had a word of caution about the new powers.
She stated: “Invariably, those central London boroughs are going to raise the vast majority of it, so how is that going to be fairly distributed across the city?”
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