UK shoppers feel pinch as prices hit 19-month high, fuelling inflation fears

Tax and payroll changes introduced by the UK government, including a new packaging tax next month, are sending retail costs spiralling

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A woman shops for food in a supermarket in Windsor on September 17. Photo: EPA

Published: 9:26am, 30 Sep 2025Updated: 9:29am, 30 Sep 2025

Price inflation in British shops rose to its highest level in 19 months, as consumers pay at the checkout for a slew of new taxes that have ramped up retailers’ costs.

The rate of inflation grew to 1.4 per cent in September from a year earlier, an acceleration from August, the British Retail Consortium (BRC) said on Tuesday. DIY and gardening products saw price rises while back-to-school items including laptops were reduced.

Retailers are battling with ballooning costs as a result of tax and payroll changes introduced by the UK government.

More than 60 companies, including Tesco and John Lewis, urged the government not to raise taxes on retailers in the autumn budget in an open letter last month.

A man strolls down Oxford Street with a shopping bag in London. Photo: EPA

“Households are finding shopping increasingly expensive,” BRC CEO Helen Dickinson said. “The impact on retailers and their supply chain of both global factors and higher national insurance and wage costs is playing out in prices for consumers.”

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UK shoppers feel pinch as prices hit 19-month high, fuelling inflation fears

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Tax and payroll changes introduced by the UK government, including a new packaging tax next month, are sending retail costs spiralling

Tax and payroll changes introduced by the UK government, including a new packaging tax next month, are sending retail costs spiralling