More businesses expect to raise prices and are scaling back their investment plans as confidence continues to weaken, according to the UK’s largest business sentiment survey.
The British Chambers of Commerce (BCC) Quarterly Economic Survey found less than half of responding firms (46%) are expecting increased turnover over the next 12 months – the lowest level in three years.
Over half of firms (52%) say they will raise their prices in the next three months, up significantly from the previous quarter (44% in Q3).
More than a quarter (27%) say they have cut back on investment plans, while just 19% of firms increased their plans. Plans to cut back are more acute among hospitality firms (37%), retail businesses (36%) and manufacturers (32%).
The survey was carried out by the BCC Insights Unit and the UK-wide Chamber network, before and after the Budget, with the fieldwork conducted between 10 November and 8 December. Over 4,600 businesses across the UK (91% of whom are SMEs) responded online.
Despite interest rate cuts and the prospect of more to come, the economy is showing few signs of growth and there are forecasts that unemployment will rise as companies are bombarded with further cost burdens.
Tax remains the biggest concern for business, cited by 63% of firms, up from 59% in Q3. This is the same level of concern seen in Q4 2024, after the previous Budget.
However, concern about taxation was heightened prior to the Budget on 26 November. Before the Chancellor’s statement, 68% of businesses who had taken part in the survey said tax was a concern. After the Budget tax concern fell to 61% of responding firms. Worries about inflation remain high, cited by 56% of firms, broadly similar to Q3.
David Bharier, head of research at the BCC, said: “Our data shows more clouds have gathered over business confidence, and the outlook for SMEs in 2026 is unsettled.
“Firms tell us they are worried about tax, struggling to invest and fear they’ll have to put their prices up in the months ahead. Firms’ confidence in their turnover growth has been stuck stubbornly below 50% for the last 12 months.
“It is now critical that 2026 is a year of delivery. The Government needs to turn last year’s strategies into action; boost investment, significantly expand trade, and ease the myriad burdens facing businesses. Only then will the economic outlook shift from its current low-growth trajectory.”
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