Britain’s business backlash: CEOs warn Reeves’s tax hikes are pushing UK to the brink

Rachel Reeves is facing a mounting revolt from Britain’s business leaders, with chiefs across sectors warning that her tax hikes and labour reforms are throttling investment, driving out wealth, and tipping the economy toward recession.

BT chief executive Allison Kirkby (pictured) warned this week that Britain is already at “peak government-inflicted costs.” Speaking at the Connected Britain conference, she revealed that BT pays ten times more in business rates, energy levies and compliance costs than rivals in Germany or the Netherlands. She said that investors need certainty on fiscal policy but Reeves’s approach risks deterring much-needed capital. The telecoms giant is already on the hook for an extra £100 million annually after the Chancellor’s last budget raised the minimum wage and employer national insurance contributions.

JD Sports boss Régis Schultz has also urged Reeves not to make Britain uncompetitive by further hiking staff costs. Warning of unemployment “going in the wrong direction,” Schultz said young consumers — JD’s key customers — would be hit hardest if labour costs rise again. JD’s profits have slumped as the group faces weak US demand and tariff uncertainty, but Schultz insisted the Chancellor must avoid adding to the pressure: “That is our plea. Don’t increase the cost of labour.”

AO World founder John Roberts issued perhaps the starkest warning, telling the BBC: “We’ve lived through a few recessions in the last 25 years – I think we’re heading into another one.” Roberts slammed Reeves’s workers’ rights bill — particularly “day one” rights for new employees — as a barrier to job creation. He also railed against the government’s tax burden, saying wealth was “leaving the UK in incredible amounts” as entrepreneurs flee.

The restaurant empire of celebrity chef Rick Stein is also struggling. Revenues fell by £1.3m in 2024, and losses more than doubled as customer numbers dwindled. Directors blamed Reeves’s changes to employer national insurance, warning the “service-led nature” of hospitality means the sector is being disproportionately squeezed. With nearly 90,000 hospitality jobs already lost since last October’s Budget, Stein’s managing director Ian Fitzgerald called on Reeves to “ease our financial pressures” in November to avoid further closures.

The warnings add to a drumbeat of concern from across UK plc. From telecoms and retail to hospitality and manufacturing, bosses are painting a picture of rising costs, eroded competitiveness and a fragile economy that could tip into recession if Reeves presses ahead with further tax hikes in November’s budget.

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Britain’s business backlash: CEOs warn Reeves’s tax hikes are pushing UK to the brink