In response to the recent Budget, M&S CEO Stuart Machin has voiced his disappointment due to the lack of clarity regarding changes in business rates.
The Budget introduced by Chancellor Rachel Reeves includes a permanent reduction in business rates for retail, hospitality, and leisure sectors, effective from 2026/27. However, Machin remains concerned about the ambiguity surrounding this change, particularly given retail’s significant contribution to the economy, accounting for 5% while shouldering 21% of business rates.
Last year, M&S alone paid £170 million in business rates, leading Machin to call for greater clarity and immediate action rather than deferring changes to 2026. Additionally, he expressed frustration over the absence of reform for the apprenticeship levy, a reform he anticipated.
The CEO highlighted a ‘double whammy’ effect, with the Budget also introducing increased National Insurance Contributions. Employers will see this rise from 13.8% to 15% on earnings above £175, with the threshold for contributions decreasing from £9,100 to £5,000. Machin noted that these adjustments would add approximately £60 million to M&S’s tax responsibilities, compounding their existing £460 million tax bill, consisting of national insurance, business rates, and corporation tax.
In another contentious move, the Budget announced a decrease in inheritance tax relief for farms and agricultural properties, dropping from 100% to 50% for properties valued over £1 million, effective from April 2026. National Farmers Union president Tom Bradshaw criticised this decision, raising concerns about its impact on family farms and food production costs. Machin empathetically mentioned M&S’s support for British farmers during these challenging times.
Despite these financial challenges, M&S reported a surge in first-half profits, driven by robust food sales, reaffirming its strategic goal to become the ‘most trusted retailer.’
Stuart Machin’s remarks underscore the pressing need for clarity and reform in business rates and other fiscal policies, as businesses brace for impending changes.
