Parents and hospitality industry to lose out in latest Budget measures

BUSINESSES and schools in Henley have reacted to the measures announced by chancellor Rachel Reeves following her latest Budget.

Changes include the decision to lift the two-child benefit cap from April 2026 and an increase to the minimum wage.

Income tax thresholds will also be frozen until the 2030-31 tax year.

Other measures include a new mileage-based tax for electric vehicles and plug-in hybrid cars and a sugar tax on pre-packaged milkshakes, which will be introduced from 2028.

Lorraine Hillier, owner of Hot Gossip in Reading Road, said the national increase to the minimum wage could make it difficult for young people to get jobs.

She said: “When they don’t have experience and they are trainees, business owners aren’t going to want to pay that when, by paying a little bit more, they can get an experienced person.”

Miss Hillier, a former Conservative councillor, said businesses are being squeezed.

She said: “Business is not growing and the cost of living has gone through the roof. It’s harder and harder to make a living. You wouldn’t want to go into having your own business nowadays. It’s too difficult, certainly in hospitality.”

Nick Armitage, headteacher at Rupert House, praised the introduction of the “sugar tax”. However, he said there is “undoubtedly” added pressure on people’s finances.

He said: “I’m very conscious of the financial pressures that parents face, whether their children are being state educated or independently educated.

“It has made us even more aware of the importance of delivering really good value for our parents as well for the financial commitment they’re making.

“But I’m really pleased to hear about the milkshake tax. We really encourage the children to eat and drink healthily and the last thing we want is to get them hooked on sugary drinks.”

Mr Armitage said although Rupert House has had its highest pupil enrolment in
10 years, he is “saddened” to see other schools struggling.

He said: “VAT has been very damaging to the sector. A number of other schools in this area have had a really big hit [with pupil] numbers.

“We were obviously very disappointed with the government putting this VAT on the parents.

“They are paying the school fees when they’re already paying for state places that they’re not taking up, so for us that’s a real sadness.”

Chris Keating, marketing manager of Brakspear in Henley, said there is an “immediate lack of support” for pubs.

From February, the tax on alcohol, including draught drinks, will increase in line with the Retail Price Index at 3.66 per cent.

He said: “The higher beer duty, combined with a range of rising operational costs, is another challenge on our already challenged hospitality industry.

“We estimate that higher business taxes alone will cost the sector an additional £150m, a burden equivalent to the loss of 12,500 jobs. For individual pubs, the pressure is even more acute.

“From April, the average small pub is expected to see its annual bills rise by £3,867, while a medium-sized pub faces increases of around £11,085. Energy bills present a further threat.” He added the price of a pint could rise by 21 pence, which could deter customers already feeling the pinch.

Financial heads at Invesco, in Reading Road, praised the reduction in the cash ISA cap to £12,000.

Will Ellis, head of specialist funds, said: “This is encouraging that the Government is working towards greater retail capital supporting investment into business and the better returns that may be earned from investment.

“While I can understand the exemption for over-65s and this cap owing to the appetite of that age group, this age group has the greatest number of ISA holders, so a half-measure.”

Benjamin Jones, global head of research at Invesco, added that mortgage rates should continue to go lower in 2026, adding: “That should give UK households a bit more confidence to spend and invest over the coming year.”

Neil Gunnell, who set up Henley Trains, a passenger support group, said the freeze on rail fares in England would be of benefit to users.

He added: “It will be a relief to commuters, especially at a time of tax rises.”