"Firms are facing a difficult winter, with private sector momentum weak and confidence fragile. Uncertainty around the upcoming Budget is weighing heavily on sentiment, with many firms keeping key decisions on hold until more clarity is forthcoming. Cost pressures from a variety of sources remain strong, with last year's tax rises adding to the drag. As a result, tough decisions to deliver policy stability and address fiscal pressures will be needed at the Budget."
"Our surveys clearly show that the private sector cannot bear the brunt of these decisions once again. The business tax burden is already at a 25-year high and - rather than tinkering around the edges - the Chancellor must strategically address the tax system's complexities that are undermining growth and deliver a Budget and tax system that helps businesses invest, hire, and scale."
Firms expect private sector activity to fall in the next three months, with a weighted balance of -20%. Forecasts show a broad-based downturn: services volumes are set to decline by 15% overall, with business and professional services down 12% and consumer services down 28%. Distribution sales are expected to drop sharply by 34%, and manufacturing output is projected to contract by 19%. Private sector activity fell by 32% in the three months to October, matching the prior quarter, with all sub-sectors reporting declines. Uncertainty around the upcoming Budget is depressing sentiment, firms are delaying decisions, and strong cost pressures including last year’s tax rises are adding to the drag. The business tax burden is at a 25-year high, prompting calls for strategic tax reform to support investment, hiring, and scaling.
Read at London Business News | Londonlovesbusiness.com
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