The outgoing boss of Britain’s largest business group has called for tax cuts to ease the pressure on Britain's businesses as they grapple with rising inflation rates.
The head of the Confederation of British Industry (CBI) Lord Bilimoria said it was “absolutely wrong” to have the “highest tax burden in 70 years”.
In an interview with The Daily Telegraph , the peer said Chancellor Rishi Sunak needed to "stop making the situation worse" while people were dealing with "rampant" inflation.
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Inflation - the increase in the price of goods and services - rose to a 40-year high on Wednesday (June 22), with the rate of rising consumer goods prices up from 9% in April to 9.1% in May.
Economists at the Office for National Statistics (ONS) said the increase was driven by record high petrol prices and steep food price rises.
Lord Bilimoria said: “It is absolutely wrong to put up corporation tax in one swoop from 19% to 25%. National Insurance is a tax on jobs – to put that up by 2.5%, which affects both employers and employees with 1.25% (each), this is the wrong thing to do.”
The peer said "now is the time" to cut taxes to generate investment and generate growth, and called on the Government to reduce VAT to help businesses and consumers.
"That is what is going to get us out of this," he said. "The Government can help more right now."
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Lord Bilimoria, also Chancellor at the University of Birmingham, praised the Government's previous actions “which helped save businesses” in 2020 and 2021. He added: "The danger of not helping is far worse than the cost of helping."
In April, South West chamber of commerce Business West urged the Government to provide more financial support to businesses amid the cost of living crisis.
It called on the Chancellor to expand the energy bills rebate scheme to help small firms, particularly energy intensive businesses. The scheme will see domestic electricity customers being given a £200 loan towards their energy bills from October, which will be paid back in instalments over five years.
Businesses are coming under increasing strain as the cost of goods continues to rise, with many warning they could collapse if nothing is done to support them.
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