It’s already coming to the end of another month, and now that we’re getting well into Summer and are half way through 2023 we’re seeing more announcements that could affect businesses.

Here’s all the latest business and tax news for June 2023!

UK Inflation Stays at 8.7%

Despite hopes and predictions that it was to fall, UK inflation has stayed at 8.7% – and core inflation has risen to 7.1%. Prime Minister Rishi Sunak has however rejected the idea of the UK going into a recession, saying ‘Nobody wants to see a recession. Of course, I don’t want to see a recession […] and actually part of the reason that we are seeing inflation be higher than we had anticipated previously is because the economy has done better.’

In order to tackle the current rate, the Bank Of England has raised the interest rate to 5%. In this event, Chancellor Jeremy Hunt has announced support for those with mortgages, reassuring them that their credit score will not be negatively affected if they seek help from the bank or mortgage lender.

Here’s what he had to say about the inflation announcement: ‘To everyone who is worried about the high inflation that we have in this economy at the moment, tackling high inflation is the Prime Minister and my number one priority. We are absolutely committed to supporting the Bank of England to doing what it takes.

We know the pressure that families are feeling. That’s why we’ve introduced big support packages, around £3,000 for the average household this year and last.

We will do what it takes and we won’t flinch in our resolve because we know that getting rid of high inflation from our economy is the only way that we can ultimately relieve pressure on family finances and on businesses.’

UK Told Not To Expect Tax Cuts

Despite the UK facing a difficult economic climate, Prime Minister Rishi Sunak has denied that he’ll be implementing tax cuts as it’s ‘simply not possible’ to do so under the current economy outlook.

He assured the public that despite the current rate of inflation and price rises, that “[…] it is going to be okay and we are going to get through this”, but tax cuts would be irresponsible at this moment in time.

Supermarkets Continue To Cut Food Prices

Supermarkets are continuing to cut food prices for customers, with Morrisons and M&S becoming the most recent retailers to do so.

Tesco, Sainsbury’s and Aldi have all cut their prices on essentials already, with Asda freezing prices on over 500 products, hoping to aid shoppers who can’t afford food at their current price levels. M&S will cut prices on more than 70 products, whilst Morrisons will slash prices by 25%

Scotland Becomes Popular For Investors

Edinburgh, Glasgow and Aberdeen have all placed in the top 5 cities in the UK for European and American investors according to business consultancy EY. With projects beginning to be moved further north of the country, both the north of England and Scotland have benefitted from the influx of the investments. Despite London remaining the number 1 choice of Foreign Direct Investors, it has seen a fall in the number of FDI’s coming to the capital to base their projects, instead choosing Scotland.

Adrian Gillespie, the chief executive of Scottish Enterprise, said that the news was “testament to the dynamic business environment that Scotland offers to investors, including our enviable skills base, world-class universities, vibrant innovation districts, ambitious entrepreneurial communities, and the outstanding quality of life on offer ‘. 

Small Boost To Retail Sales

The Office For National Statistics has reported that retail shops have seen a 0.3% increase in sales as consumers spend for summer, with online and garden stores being named as two of the most successful when it comes to sales.

Whilst the growth is lower than it has been in previous years, this is still a positive sign for retail businesses, especially those who have struggled to attract customers post-pandemic.

Consumers Beginning To Take Advantage Of Subscription Services

A recent study by OnePoll found that just 1% of UK residents surveyed don’t consider themselves to be subscribers.

Despite financial uncertainty, many Brits have turned to subscription services and schemes in order to save money, with 41% citing cost-effectiveness and 49% citing convenience as a positive of the services.

A spokesperson from OnePoll said of the results: ‘Subscriptions are allowing people to buy what they need, and enjoy the things they love, more easily, and for less. This is a huge part of why we are seeing a boom in the subscription economy globally.’

That’s all the news for June! As we move into July, businesses will have to keep an eye on changing interest and inflation rates to ensure their business stays afloat and can still provide for customers. Have a great month!