The boss of pub chain Wetherspoons has warned that prices are “certain to rise” when the national insurance (NI) hike comes into force in April.
Devon-based entrepreneur Sir Tim Martin told Sky News the chancellor’s plan to increase employers’ NI contributions would cost his business £1.2m a week.
In the Autumn Budget, Rachel Reeves confirmed NI for companies would rise from 13.8% to 15%, alongside a reduction in the threshold for employee wage eligibility for the tax from £9,500 to £5,000 a year.
“There will definitely be an increase [in prices], and an increase in inflation as a result of the tax increase,” he told Sky on Wednesday.
Sir Tim also slammed the “level of taxes” the hospitality industry is facing. He said: “It’s more for pubs and hospitality than for supermarkets because we’ve got more labour costs per pint.”
The pub tycoon criticised “modern politicians”, saying “they don’t understand and have a natural feel for the importance of free enterprise”.
In October, Wetherspoons revealed its profits had rebounded as strong customer demand boosted revenues. Pre-tax profits jumped 73.5% to £73.9m for the year to July 28, compared with the previous year.
Last summer, Sir Tim netted nearly £10m after selling more than one million shares in his company. The outspoken entrepreneur sold 1.36 million ordinary shares at a price of 739p apiece.
His comments come as businesses across the UK brace for an increase in NI contributions from April.
Business leaders in the beauty industry have warned the changes to NI will “stifle growth”, and have called for Rachel Reeves to provide support in the Spring Statement.
The British Hair Consortium, which represents 50,000 UK hairdressing professionals, is calling for the chancellor to halve the VAT salons pay on labour costs to 10% to help them overcome recruitment challenges.