Kingfisher urges reevaluation of tax increases for retailers

The owner of B&Q, Kingfisher, has called on Rachel Reeves to reconsider planned tax increases for retailers ahead of Wednesday’s spring statement. The retail industry faces rising costs due to increased National Insurance contributions and business rates, which the company argues stifles innovation comparable to that of US technology firms.

Thierry Garnier, the chief executive of Kingfisher, remarked that the company anticipates an additional £45 million in costs this year stemming from these changes. Starting in April 2026, larger retail outlets could see significant hikes in business rates, particularly those with a rateable value exceeding £500,000. This reform, aimed at levelling the playing field for online retailers, inadvertently impacts physical stores, including department stores and large retail sites.

Garnier expressed concerns over the government’s readiness to cut taxes for major US tech companies while increasing financial burdens on traditional retailers. He emphasised that retailers like Kingfisher are also investing in innovative technologies such as AI and robotics, deserving of equal tax treatment and support.

The impact of these tax increases is reflected in Kingfisher’s financial performance, with shares dropping over 14% this week following news that profits could fall below expectations. Despite a 7% increase in profits over the past year, the group’s total sales fell by 1.5% to £12.8 billion, largely due to a significant decline in its French operations.

Despite these challenges, Garnier noted resilience among UK and Irish consumers who continue to engage in home improvements. To mitigate the rising costs, the company plans to streamline its distribution centres and enhance self-checkout facilities across its stores.

As the retail landscape shifts, Kingfisher remains committed to adapting its strategies to ensure continued growth and job creation, particularly within its Screwfix and B&Q outlets.