Britain’s Supermarkets Call for Tax Exemption

Britain’s biggest supermarkets are calling on the Chancellor to exempt stores from a new top business rates tax, warning that shoppers will bear the brunt of higher prices. Tesco, Sainsbury’s, Marks & Spencer, Waitrose, Morrisons, Asda, Aldi, and Lidl are among the stores that have signed a letter to the Chancellor arguing that easing taxes on grocers would help curb food inflation.

The Impact of Higher Business Rates

Industry body the British Retail Consortium (BRC) said large stores could face higher business rates if they were included in the government’s proposed additional tax on properties worth more than £500,000. Smaller shops are expected to benefit from reduced business rates under the Government’s plans. The letter stated that if the industry is faced with higher taxes, their ability to deliver value to customers will become even more challenging, and it will inevitably be households that feel the impact.

The Burden on Retail

Large retail stores make up a tiny proportion of all stores but still account for a third of the total retail business rates bill. The supermarkets are calling on the Chancellor to address the disproportionate tax burden on retail, saying this would send a strong signal of support for the industry and the Government’s commitment to tackling food inflation. The Chancellor is widely expected to raise taxes after dire economic forecasts and a series of rollbacks in welfare cuts that have made it harder to meet borrowing limits.

The Struggle to Keep Food Prices Affordable

The chief executive of the BRC said supermarkets are doing everything they can to keep food prices affordable, but it is an uphill battle, with over £7 billion in additional costs incurred in 2025 alone. From higher social security contributions to new packaging taxes, the financial burden on the industry is immense. The Ministry of Finance has been contacted for comment.