Hope that this week’s budget would provide economic relief for local businesses was dashed for some on Wednesday, as Chancellor John Healey’s minimalist budget was announced.
One Kingston business owner expressed frustration at high inflation and a heavy tax burden.
Restaurant owner Simon Baile said he feels they’ve been “squeezed from both ends” by higher fuel duty and large taxes.
Baile, who runs restaurant and bar Ex Celler, previously told The Courier he pays a VAT bill of around £45,000 a year for two small restaurants in Kingston and Surbiton. This high tax means he’s unable to hire more employees in the local area. “As owners, we’re having to work the floor every night,” he said. “We haven’t been able to take a holiday in over a year and a half.”
Baile hoped for a discount on VAT in hospitality and other small businesses, which would have a much greater impact on protecting the High Street. “We’d start employing young people overnight,” he said. This, he added, would help reduce youth unemployment and help contribute local economic growth to the Kingston area.
When asked on Wednesday, Baile said Healey’s budget was “No help to us and much of London”, and the government appears to be “tone death to the struggles of most of us”.
Healey announced in Parliament that “fiscal discipline” was the underlying theme of his budget to soften the blow of “economic headwinds” caused by “global storms”. A £100 energy payment to residents living in council tax bands A-D and a £14bn investment to reduce the size of public debt were the key headlines of Healey’s budget.
Healey provided a business rate relief for retail, hospitality and leisure businesses valued from £12,000 to £18,000, meaning an additional 70,000 businesses across the UK will no longer have to pay business rates, a move designed to “protect the High Street”.
It remains to be seen whether this will have any lasting impact on business costs, particularly in London, where margins are comparatively larger than the rest of the country.
“We haven’t been able to take a holiday in over a year and a half.”
– Simon Baile, owner of Ex Cellar.
Before Wednesday, the IMF (International Monetary Fund) predicted 1.3% growth in the UK’s economy in 2026, yet concerns remain over the cost of living and inflation into next year. High energy prices and inflation are expected to increase as conflicts in Iran and Ukraine continue to drive energy prices up and Britain braces for winter, a fact Healey reinforced throughout his speech.
After the budget, the Office of Budget Responsibility (OBR) said that the UK’s economic outlook is “a pretty grim picture”, with greater long-term spending plans needed.
It remains unclear whether Healey’s measures in this budget will have any long-term impact on Kingston’s companies, or whether cautionary policies will protect Kingston’s businesses from a volatile economic climate.
