UK retailers to open more stores amid tax hikes

UK retailers committed to opening more stores during the first quarter of the year, despite worries over tax changes coming into effect this month.

Between January and March, just under 7,000,000 sq ft of retail space was leased throughout the UK, making it the highest amount since the pandemic started, according to property firm CoStar.

This marks an 8% rise on the prior quarter, as well as a 25% increase on the same period last year, representing the strongest retail leasing activity in six years, The Times reported.

The figures come amid retailer fears over the impact of April’s tax rises. In January, New Look revealed it was set to speed up its store closure programme following increasing cost pressures.

Around a quarter of the retailer’s 364 stores nationwide are understood to be at risk when its leases expire, putting some of its 8,000 workforce at risk.

In November, HMV also suspended its new store openings across the UK as it claimed the April tax rises had made it too risky to invest.

CoStar senior director of UK market analytics Mark Stansfield claimed that while the recovery of retail was still fragile, the rise in retail take-up indicated a wider recovery in consumer behaviour.

It comes after The Centre for Retail Research warned that more than 17,000 stores were set to close over 2025 in January, as retailers faced higher costs following Labour’s first fiscal Budget.

The research foundation claimed that “worse is yet to come” after it reported that 13,479 stores closed their doors for the final time in 2024, marking a 28% increase on 2023.

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