BRITAIN is facing a “hat-trick of horrors” as we are hit by higher taxes, possible US trade tariffs and new regulation on businesses.
Rachel Reeves and Sir Keir Starmer are in a 72-hour scramble to convince Donald Trump not to clobber us with crippling trade levies on April 2.
PAChancellor of the Exchequer Rachel Reeves leaving 11 Downing Street for her Spring Statement[/caption]
The tariffs would drive up prices, wipe out growth, and send Labour’s economic plans into meltdown.
Just four days later, on April 6, the £24 billion National Insurance tax hike comes into force potentially devastating high streets.
Meanwhile, the workers rights bill – which is currently being debated by parliament – is also set to hammer firms with growth-choking red tape.
Kemi Badenoch warned “hat-trick of horrors” will lay waste to UK plc.
Writing in The Sun on Sunday, the Tory Party leader said: “The Prime Minister needs to get a grip before this triple whammy of economic pain sticks our country in a doom loop of stagnant growth and unemployment.”
Business chiefs warned the triple blow will drive up prices and lead to a tsunami of job losses.
Kate Nicholls, CEO of UK Hospitality – an umbrella group which represents pubs, clubs and restaurants – said: “Businesses are being battered by decisions made in Westminster.”
The Labour government is already on the ropes on the economy.
Earlier this week, the government’s fiscal watchdog the OBR halved its growth prediction for the next year to a paltry 1 per cent.
Many government departments have been ordered to find deep spending cuts as Chancellor Rachel Reeves struggles to make her sums add up.
PAConservative Party leader Kemi Badenoch at the launch of a “policy renewal process”[/caption]
But the grim economic picture is poised to get even worse this week.
President Trump is threatening to slap tariffs of up to 25 per cent on all countries that impose VAT on goods – including the UK.
The PM and his team are in frantic talks with the White House to try to avoid the crippling levies – which come into force this Wednesday.
If they fail, Britain’s entire economic growth could be wiped out at one flick of Donald Trump’s pen.
This would send prices rocketing and could lead to heavy job losses.
Downing Street insiders said talks will “go down to the wire” and could even carry on after April 2 – which is being dubbed Liberation Day in the White House.
No 10 does not believe a trade war is in anybody’s interests. Ministers are in talks with the US to try to avoid tariffs.
Talks will continue through and after April 2 – that is not the end of the negotiations.
No10 says all options are on the table – including retaliatory tariffs.
But insiders think it is unlikely Downing Street will engage in a tit for tat trade war as that would hammer our economy and just aggravate the Trump administration.
They are prepared for trade talks to go beyond tariff day on April 2.
President Trump has already slapped 25 per cent tariffs on UK steel.
Days later, British Steel announced it was closing its blast furnaces at Scunthorpe putting 2,700 jobs at risk.
On April 6, the controversial NICs tax hike kicks in.
UK Hospitality said the crippling tax bill will hammer pubs, bars and restaurants.
Some 70 per cent of its members plan to cut staff or slash staff hours because of the hike, according to their latest survey.
While just under a third of their members said they will restrict opening hours because of the hike.
And one in seven pubs, bars and restaurants are planning to close a site.
Ms Nicholls said: “This NICs tax rise is not only bad for employers – it is bad for workers too.
“It will drive up costs, drive down wages and is already leading some of our members to stop hiring new people and restrict their opening hours.
“If we get hit by Donald Trump’s tariffs, you need the rest of the economy firing on all cylinders.
“Ministers should be doing everything they can to support the everyday economy and our high streets.
“But instead, we are being hit by a toxic mixture of higher taxes and red tape.
“It just doesn’t make sense.”
The government is also planning to bring in a new workers rights bill – which will slap firms with more new regulations.
The flagship bill has been spearheaded by Deputy PM Angela Rayner.
But it is expected to be watered down after the OBR warned Ms Reeves it will harm economic growth and push up unemployment and inflation.
A ban on “exploitative” zero hour contracts is set to be diluted so seasonal workers are effectively exempted.
A clause to introduce “day one employment rights” could also be kicked back until after a probationary period of 9 months or a year.
Tina McKenzie, from the Federation of Small Businesses, said: “Looming tax hikes, barriers to trade and new laws to make it harder to hire risk businesses going to the wall and more people left out of work.
“Ministers should be making it easier to take people on and grow businesses, or everyone will end up poorer.”
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