Kwik Fit warns of price rises due to National Insurance hike

Firm anticipates passing increased costs onto consumers

Kwik Fit warns of price rises due to National Insurance hike

Kwik Fit has indicated that it plans to increase prices for customers as a direct consequence of Labour’s proposed rise in employer’s National Insurance (NI) contributions. Mark Slade, Kwik Fit’s managing director, cautioned that the company intends to raise the cost of its services to offset the increased financial burden.

Speaking to the BBC, Mr Slade also suggested that the NI changes could affect staffing levels, with the company potentially not replacing individuals in senior roles. The motoring repair specialists estimate that the new NI contribution increases will cost the firm approximately £5 million, a cost that is likely to be felt by consumers.

Mr Slade told the BBC, “We are really careful to make sure Kwik Fit is always competitive and benchmarked against the people around us – but the reality is that includes increasing prices. There will be some people who aren’t replaced over the coming year and that will be in the senior levels.”

Labour’s Chancellor, Rachel Reeves, confirmed the increase in National Insurance Contributions (NICs) from 13.8% to 15% in the Autumn Budget. Additionally, from April 6th, businesses will begin paying NI on workers’ earnings above £5,000, a reduction from the previous threshold of £9,100.

While officials have projected that these changes could generate an additional £25 billion in annual revenue by the end of the 2029/30 tax year, the Office for Budget Responsibility (OBR) has warned that the move could lead to “lower wages and profits.” HM Revenue and Customs (HMRC) also acknowledged the potential “economic impact” of the new NIC increases, citing the OBR’s assessment that it could reduce potential output and labour supply.

Following the Autumn Statement, Kwik Fit’s competitor, Halfords, also suggested that the NI decisions could impact motorists, with Chief Executive Graham Stapleton indicating that increased costs could be passed on to customers. He noted that the cost implications are particularly significant for specialist retailers providing in-person expert advice and assistance.

Source: The Express

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