Recent data reveals that Rachel Reeves’ tax policies and Donald Trump’s tariffs have severely impacted business confidence in the UK, driving it to its lowest level in over two years. The Confederation of British Industry (CBI) reported that private sector activity remains “subdued,” with firms anticipating further declines in the coming months. CBI economist Alpesh Paleja noted: “Uncertainty has ramped up over the last few weeks,” highlighting the effects of global volatility and rising national insurance contributions. With the Government facing pressure to stimulate growth, the upcoming industrial strategy and spending review will be crucial for addressing these challenges. Economists warn that without significant measures, Reeves’ £9.9bn fiscal headroom may be jeopardised, potentially leading to further tax increases in the autumn.

Scotland has witnessed a 31% year-on-year increase in business insolvencies, with 105 companies declared insolvent in March 2025, compared to 80 in the same month last year. Sectors such as hospitality, construction, and retail are particularly affected, grappling with inflation and rising costs. Chris Richards, founder of SimplyQuote, emphasised that many small businesses overlook significant savings on fixed costs, stating: “In survival mode, small business owners tend to prioritise sales and staffing—but what’s often missed is the cost creep of everyday services.” Reports from the Federation of Small Businesses reveal that over 60% of SMEs do not compare insurance policies, leading to unnecessary expenses. Experts warn that without addressing these inefficiencies, insolvency rates may remain high into the latter half of 2025. “It’s about operational discipline,” Richards added, highlighting the importance of scrutinising outgoings for survival.

In April, house prices in the UK experienced a notable decline, falling by 0.6% month-on-month, marking the largest drop since August 2023. According to Robert Gardner, Nationwide’s chief economist: “The softening in house price growth was to be expected, given the changes to stamp duty at the start of the month.” The average home now costs £270,752, with annual growth slowing to 3.4% from 3.9% in March. Following the recent changes, first-time buyers in England and Northern Ireland now pay stamp duty on properties priced over £300,000, down from £425,000. Gardner anticipates that while the market may remain subdued, “activity is likely to pick up steadily as summer progresses.” Meanwhile, lenders are adjusting mortgage rates, with Barclays offering fixed rates below 4%.

Beales, one of Britain’s oldest department stores, is closing its last outlet in Poole, Dorset, blaming the Chancellor’s tax increases for rendering the business “unviable.” Chief Executive Tony Brown stated that the tax rises from last October’s Budget cost the company £200,000, contributing to its closure. He expressed concerns that the “fiscal strategy” could lead to more businesses shutting down, leaving only “cafes and vape shops” on the high street. The British Retail Consortium reported that over 250,000 jobs have been lost in the retail sector over the past five years, with rising costs threatening thousands more. Helen Dickinson, Chief Executive of the British Retail Consortium, warned that the closure of Beales is indicative of a broader crisis in retail, stating: “The closure of Beales is not the first, and will not be the last retailer crushed under the weight of the £7bn in additional costs on retail confirmed in last October’s Budget.”

Inheritance Tax (IHT) receipts in the UK have reached a record high of £8.2bn for the period from April 2024 to March 2025, with His Majesty’s Revenue and Customs (HMRC) expected to gain an additional £800m due to recent legal changes. Financial expert Jonathan Halberda from Wesleyan Financial Services stated: “With an increasing number of families being pulled into the scope of inheritance tax, the latest rise in receipts comes as little surprise.” He warns that many individuals with modest assets may now face unexpected tax bills, particularly unmarried couples who lack exemptions available to married partners. To mitigate IHT liabilities, Halberda suggests strategies such as gift-giving, leveraging trusts, and creating a Will.

The Supreme Court’s recent ruling on trans inclusion in the Equality Act has brought significant clarity, according to Baroness Falkner, who stated it provided “welcome clarity” on a contentious issue. However, many businesses, which have adopted inclusive policies, now face a legal dilemma as the guidance from the Equality and Human Rights Commission (EHRC) mandates single-sex facilities. This has left firms scrambling to reconcile their practices with the new legal landscape. Bobbi Pickard, chief executive of Trans in the City, expressed that the ruling has created “huge ambiguity” for employers, while Maya Forstater of Sex Matters warned that companies sticking to old policies could face legal action.

The Treasury Committee has raised concerns about the risks associated with financial influencers, or “finfluencers,” highlighting the potential for individuals to lose their money due to bad advice or fraud. Lucy Castledine, director of consumer investments at the Financial Conduct Authority (FCA), reported that in 2024, the FCA received 25,000 reports of unauthorised businesses. She acknowledged the importance of financial education but warned against straying into regulated advice without proper authorisation. Steve Smart, joint executive director of enforcement and market oversight at the FCA, added: “We are not at all trying to demonise finfluencers in general. If people are provided with the right advice, that’s a good thing, it’s those that are breaking the law and providing harmful advice that we are focused on.” The FCA also pointed out that Meta, the owner of Instagram and Facebook, is the slowest social media company to take down content posted by finfluencers and fraudsters running financial scams.

The House Financial Services Committee is set to review legislation that aims to significantly reduce funding for the Consumer Financial Protection Bureau (CFPB) and effectively eliminate the Public Company Accounting Oversight Board (PCAOB). The move is part of a broader Republican effort to find savings for a tax cut bill, with the banking panel tasked to identify at least $1bn in cuts. The proposed legislation would lower the CFPB’s funding cap from 12% to 5% of the Federal Reserve’s operating expenses, potentially reallocating excess funds to the Treasury. PCAOB Chair Erica Williams expressed concern, stating: “The unique experience and expertise built up by the PCAOB over decades cannot simply be cut and pasted without significant risk to investors at a time when markets are already volatile.” The SEC would absorb PCAOB’s responsibilities, raising questions about the future of audit quality and investor confidence.

Doug Gurr, the new chair of the Competition and Markets Authority (CMA), writes in City AM on the importance of protecting UK consumers whilst promoting competition. He says: “We must evolve, but we’re sticking firmly to the fundamentals.” Gurr highlights the need for good regulation to support long-term policy goals, particularly economic growth, which is essential for improving public services and quality of life. He stresses that investment is critical, noting that the UK has the lowest level of business investment in the G7. The CMA is implementing improvements across its processes to encourage competition and consumer confidence, particularly through the new Digital Markets competition regime, which aims to adapt to fast-moving markets.

Three in five British companies report that “rising and unstable” energy costs are hindering their growth plans, according to a survey by EY. The International Energy Agency highlights that Britain’s industrial energy costs are the highest in the G7, 46% above the average of IEA member states. Colm Devine, EY’s power and utilities sector lead, said: “Energy is clearly no longer just a commodity, it’s a competitive and strategic asset which is likely to continue to be subject to significant change and investment over the coming years.”

UK fraud investigators have arrested three individuals linked to Blu-3, a British construction firm, amid allegations of bribery during the construction of a datacentre for Microsoft in the Netherlands. The Serious Fraud Office (SFO) reported that over £3m was allegedly paid in bribes to associates of Mace Group. More than 70 investigators conducted searches across multiple locations, including London and Kent. Nick Ephgrave, director of the SFO, said: “Paying bribes to do business undermines our financial markets, the reputation of British companies and the rule of law and will not be tolerated.” Blu-3, which has a strong pipeline of work for 2025, has previously collaborated with Mace on significant projects like the Shard and HS2. Mace Group has also expressed its commitment to supporting the SFO’s investigation.

Economists are challenging Energy Secretary Ed Miliband’s assertion that the UK’s high taxes on oil and gas producers do not affect household energy bills. Dan Slater, director of research at Zeus Capital, argues that there is a clear connection between consumer bills and the taxes imposed on energy producers, particularly for gas. He states: “If there is more gas available from the North Sea… this would likely have had a downward effect on the wholesale prices.”