Garden centres are being battered by Rachel Reeves in 'triple whammy' tax hit

The future of hundreds of horticultural firms are at risk following a "triple whammy" hit by Rachel Reeves, the industry has warned. Garden centres, nurseries and landscapers are among the businesses who will be battered by changes to inheritance tax, hikes in national insurance contributions (NIC) and increases in the National Living Wage (NLW).

It comes as the British Retail Consortium (BRC) warned the latter two changes will together cost the retail industry over £5billion a year, rising to £7billion when a new packaging tax comes into force in October. Inheritance tax changes only come into force from April 2026. The Horticultural Trades Association (HTA) said the "triple whammy" means two thirds of its 1,300 members plan to raise prices, while many will postpone or reduce capital investments and consider hiring freezes.

The green sector is expecting a 21% reduction in net profit this year because of the NIC and NLW costs, totalling to a £134 million collective blow to the HTA's members.

Fran Barnes, CEO of the HTA, said: "These financial pressures come on top of an already challenging couple of years, during which businesses essential to the green economy have not only been battered by severe weather, rising costs, border issues, plant health fees, and weakened consumer confidence.

"Environmental horticulture is more than just an industry - it's vital to our nation's green future. With the proper support, we can help Britain grow greener, stronger, and more resilient. It's time for the government to work with us, not against us, to cultivate that future."

The BRC said the cost of employing people into entry-level jobs leapt by over 10% on Sunday for retailers across the country, and by a massive 13% for those working part-time.

From Sunday, employers' NICs will increase to 15% from 13.8%, and the level at which employers start paying NICs, will be reduced to £5,000 a year from £9,100.

On April 1, the NLW for those aged 21 and over increased to £12.21 per hour, while the National Minimum Wage for 18-20 year olds rose to £10.00, and the apprenticeship rate and 16-17 year old rate increased to £7.55.

Helen Dickinson, chief executive of the BRC, said: "Retailers have spent the last five months preparing for the consequences of these new costs on their businesses. While there will be an impact on employment, the Government must consider how its future policies can mitigate this, making it easier for businesses to employ people. This includes ensuring the Employment Rights Bill improves workers' rights without hampering job creation at this crucial time."

Small business's confidence remains "sluggish", the Federation of Small Businesses has said.

A striking 85% of people polled by the group reported rising costs, compared to the same period last year, with nearly a quarter (23%) saying their costs had increased by more than 10%.

Only 8% of firms saw an increase in staff numbers over the first three months of this year, while more than double that - 21%- had to reduce their workforce.

Tina McKenzie, FSB's Policy Chair, said: "There's been a modest improvement in small firms' confidence, but the outlook remains pessimistic.

"There is no way to sugarcoat the impact that rising costs and higher taxes are having on small firms. Their already tight budgets are being stretched thin, and it's making it harder to thrive in a demanding economic climate."

She added: "The focus now must shift on easing these pressures on small businesses. Lower taxes and practical support must take priority in the autumn budget to give small firms the breathing room they need to thrive.

"That would allow small businesses to reinvest, grow and play their part in driving the economy forward."

A Government spokeswoman said: "We are a pro-business government, and we know the vital importance of small businesses to our economy and have already achieved a great deal in a short period of time, including protecting the smallest businesses from the employer National Insurance rise and late payments, protecting 250,000 retail, hospitality and leisure business properties from paying full business rates and capping corporation tax.

"We delivered a once-in-a-Parliament budget that took necessary decisions on tax to stabilise the public finances, including the NHS which has now seen waiting lists fall five months in a row.

"We are now focused on creating opportunities for businesses to compete and access the finance they need to scale, export and break into new markets."

The environmental horticulture sector is at the heart of Britain's green economy, contributing £38 billion annually and supporting over 720,000 jobs. From growers and garden centres to landscapers and manufacturers, this vibrant industry enhances our communities, boosts physical and mental wellbeing, and plays a critical role in tackling environmental challenges.

However, the Chancellor's Autumn Budget and Spring Statement provide little relief for horticulture businesses, failing to inspire confidence with our members. Many businesses are struggling with changes to Agricultural Property Relief (APR) and Business Property Relief (BPR), as well as increases in the National Living Wage and adjustments to National Insurance contributions. As a result, the future viability of many horticultural businesses is now at risk.

These financial pressures come on top of an already challenging couple of years, during which businesses essential to the green economy have not only been battered by severe weather, rising costs, border issues, plant health fees, and weakened consumer confidence. The Horticultural Trades Association's recent survey revealed that nearly two-thirds of businesses are considering raising prices, delaying investment, or freezing recruitment due to a £134 million forecast collective hit on HTA members. This is not a growth agenda - it is a cliff edge for many family-run SMEs that form the backbone of our sector.

Our message to the government is clear: prioritise decisive action to alleviate the cost burdens in the sector, consult on APR and BPR, and commit to fair policies, so that our members can continue to contribute to the UK's environmental sustainability and overall economic wellbeing. This sector is ready to be part of the solution, but we need certainty, stability and a supportive framework to thrive.

Environmental horticulture is more than just an industry - it's vital to our nation's green future. With the proper support, we can help Britain grow greener, stronger, and more resilient. It's time for the government to work with us, not against us, to cultivate that future.