Budget keeps builders stuck in the mud: NFB

“Death by a thousand taxes has already killed off many businesses, with insolvency rates still high within the construction industry," says NFB chief

The National Federation of Builders (NFB) aired its grievances as Chancellor of the Exchequer Rachel Reeves delivered her second budget last week, unveiling an array of tax measures.

For the federation, the most essential element of the budget was scrapping the unviable landfill tax increase of 3,015% and instead implementing a smaller uplift.

Ultimately, the Budget's highest cost was the increase in hiring costs, especially for firms hiring young people. 

Richard Beresford, Chief Executive of the National Federation of Builders (NFB), said: “Construction feared the worst from the budget, particularly on landfill tax. While we heard on this proposal, the lower rate landfill tax, or ‘muckaway’, will still more than double in price.

“Furthermore, businesses that employ directly, take on apprentices, or choose to decarbonise their vehicle fleets, will be throwing their arms up in frustration.

“There was nothing on stamp duty land tax rebates for the most efficient homes, no cancelling of the Building Safety Levy and not a murmur on Help to Buy, all of which means industry will remain in the mud.

“Death by a thousand taxes has already killed off many businesses, with insolvency rates still high within the construction industry. The Government must therefore redouble its efforts to make projects more certain for investors, while helping the construction businesses that deliver them become more viable. Planning reform is one place which will help industry, and we can only assume that, as they were omitted from the budget, they have been saved for the housing secretary, Steve Reed.”

Some of the most essential parts of the budget for builders include:

• The landfill tax will not converge to a single rate as previously proposed, but the lower rate will be uplifted with the same multiplier as the standard rate. So, for 2026-27, the lower rate will be £8.65 per tonne and the standard rate will be £130.75.
• Public bodies will be provided with grants to remediate land where landfill tax is an ‘unaffordable blocker’.
• £48 million of additional funding is being allocated to boost capacity in the planning system, which will increase recruitment across the planning system to 1,400 by the end of this Parliament.
• A ‘High Value Council Tax Surcharge’ on properties in England that are worth £2m or more, from 2028-29.
• The most expensive properties will fund relief for retail, hospitality and leisure (RHL) buildings

One of the most pressing issues is the increase in the minimum wage. It will impact firms that hire younger workers and apprentices the most, as they receive the most significant pay increases.