‘Enough is enough!’: Tesco boss urges Rachel Reeves to avoid tax hikes

The boss of Tesco has warned the Chancellor that ‘enough is enough’ amid fears of more tax rises as the supermarket upgraded its annual profits.

Britain’s biggest supermarket boosted profit expectations after fending off ‘competitive intensity’ in the market thanks to a scorching summer.

But chief executive Ken Murphy warned shoppers are ‘worried’ about the November Budget and urged her to not whack retailers with higher costs again.

Murphy said: ‘Our one ask is don’t make it harder for the industry to deliver great value for customers.

‘In the last Budget, the industry in the sector incurred substantial additional operating costs. We’re doing our best to deal with them. But enough is enough.’

Retailers have been grappling with a £7billion increase in costs following last year’s Budget.

They have pleaded with Labour to help the sector through business rates reform.

Murphy reiterated his call for large retailers to be excluded from a higher rate of tax in Labour’s rates reforms, arguing these ‘anchor’ tenants attract shoppers to the High Street.

‘All we’re asking is that the government follow through on its promise and make it a fair system,’ he said.

The grocer said it now expects annual profits between £2.9billion and £3.1billion – an upgrade from an earlier forecast of between £2.7billion and £3billion.

Earlier this year, the grocer pledged to take a hit to profits as it fired the starting gun on a supermarket price war in April.

But good weather helped UK like-for-like sales rise 4.9 per cent in the first six months of the year, while it also poached shoppers from rivals.

The supermarket now holds 28.4 per cent of the market, and has been attracting customers with its Aldi price match and Clubcard scheme.

These gains helped to offset a hit in cost inflation, including Rachel Reeves’ raid on National Insurance contributions and a new packaging levy.

‘Competitive intensity remains high, and with continued pressure on household budgets, we remain committed to ensuring customers get the best possible value by shopping at Tesco,’ Murphy added.

He said there was a ‘mixed sentiment among customers’ as the group prepares for its key Christmas trading period.

‘They are concerned. They are worried about the Budget, they’re worried about the economic outlook,’ he said.

It comes as economists expect food inflation to remain above 5pc into next year, creating further pressure on households.