Private enterprises want an environment with no surprises

Private enterprises want a stable tax and regulatory environment with no surprises

Richard Hall, KPMG

Changes in recent Budgets have put more cost pressure onto businesses, particularly higher employer national insurance contributions, changes to inheritance tax and business property relief, as well as increases to the National Minimum Wage.

Nearly every business has seen an increase in tax and employment costs overall. This underlines the fact that tax is a cost on the P&L just like any other, and needs to be monitored and managed accordingly. This is all the more important when trading conditions are challenging.

Our latest Pulse survey of private enterprise leaders shows tax certainty and predictability feature high up executive wish lists. When asked what factors are most likely to influence their long-term planning for growth, investment and exit, the stability and predictability of the tax and regulatory environment was the second highest factor (45%), only ranking behind the UK’s overall economic outlook (56%). It’s a measure of the extent to which tax is now on the strategic decision-making radar.

Thinking about the biggest short-term risks to their business, it was ongoing cost pressures (inflation, energy, materials, services) that dominated (47%) responses from business leaders. Tax is also a component of these costs, of course. The second highest short-term risk was global disruption impacting supply chains (33%) – as has been thrown into sharp focus recently through the conflict in Iran and the disruption in the Straits of Hormuz. Third on the list was tax and fiscal policy uncertainty following the 2025 Autumn Budget (25%), underlining once again the desire for tax predictability.