Next warns that higher taxes could choke UK growth ahead of Budget
Retail chain Next cautioned that any tax hikes in the upcoming Budget would worsen consumer pressure and hamper economic growth.
In its half-year results, Next lowered its forecast for UK sales growth to 2% and warned that the upcoming Budget’s tax proposals could further squeeze consumers already burdened by inflation linked to the Iran war and a soft jobs market. CEO Simon Wolfson argued that one outlet tax load, the highest in more than 60 years, risks stifling growth and could ultimately damage public finances. He urged the government to focus on controlling spending and implementing supply-side measures to boost the economy.
Despite the warning, Next posted a profit upgrade, with UK full-price sales up 3.6% and online sales rising 7.4%, while international online sales jumped 23.9%. Underlying pre-tax profit rose 10.5% to £569 million, and the firm now expects full-year profit to increase 8% to £1.23 billion.
Why it matters
Higher taxes could further depress consumer spending and slow UK economic recovery.
How the sides frame it
MODERATE AGREEMENTBoth camps note Next’s strong first-half performance and profit lift, but right-leaning coverage adds a warning that higher taxes could choke UK growth, a point omitted by left-leaning coverage.
LEFT
Frames the story as a positive profit outlook driven by an unexpected boost in sales from hot weather.
RIGHT
Frames the story as a profit success that is tempered by concerns that rising taxes will stifle economic growth.
The left emphasises
- unexpected boost in sales
- raised profit forecasts for the fourth time this year
- hot weather lifts sales
The right emphasises
- lifted profit target again
- defying fears of inflation and a slowdown in consumer spending
- warns against growth-stifling tax rises
In this story
