Leading family-run accountancy firm, Lamont Pridmore, has said business confidence in the North West and across the UK is falling due to the growing burden of taxation.
The Cumbrian-based firm, which serves clients across the North West, is sharing the latest results from the ICAEW (Institute of Chartered Accountants in England and Wales) Business Confidence Monitor (BCM), which reveal that national business confidence has turned negative for the first time since 2022.
According to the Q1 2025 findings from the ICAEW, business sentiment nationally has dropped to -3.0 on the index.
This sudden change to negative sentiment is mainly being driven by rising concerns over tax increases, ongoing inflation, weak UK economic growth and growing uncertainty on the global stage.
In the North West, confidence had already slipped below the historical average in Q4 2024, despite the region reporting the highest profit growth in the UK and outperforming the rest of the nation in capital investment and domestic sales.
Graham Lamont, Chief Executive of Lamont Pridmore, said: “The data tells a complex story. While North West businesses are delivering strong profits and leading the way in capital investment and domestic sales growth, confidence is nevertheless being undermined by tax uncertainty and rising regulatory pressures.
“Our clients are ambitious and optimistic by nature, but the recent Autumn Budget has caused concern, particularly around changes to National Insurance, which are driving up costs from this month.
“It’s no surprise that confidence has now tipped into negative territory nationally. Many small and medium-sized businesses feel squeezed.
“They are trying to plan for growth while navigating inflationary pressures, higher wage expectations and an increasingly heavy tax burden – not to mention and increasingly uncertain global economic backdrop.”
The latest BCM, which surveyed 1,000 ICAEW Chartered, highlights several other key findings:
- Concern about the tax burden reached a record high, with 41 per cent of businesses citing it as a key challenge
- Domestic sales growth nationally has slowed to 3.2 per cent, the lowest rate since Q3 2021
- Export growth remains weak and below historical averages
- Profit growth expectations have softened as companies brace for higher input prices and wage demands
Graham Lamont added: “The recent Spring Statement brought very little to be excited about and the Government needs to act decisively to restore confidence.
“Investment incentives, tax simplification and targeted support for SMEs would go a long way to reassure business owners and unlock further growth.
“Businesses across Cumbria and the wider North West have shown real resilience, but now they need the right environment to thrive.”
The ICAEW’s quarterly Business Confidence Monitor has been running for two decades and is one of the most comprehensive surveys of business sentiment in the UK.
The latest results offer a sobering view of the economic mood, even as many businesses continue to perform strongly in real terms.
To find out more about Lamont Pridmore’s accounting, tax and business advisory services, please contact us.
