The recent announcement by the UK Government regarding increases in National Insurance contributions, coupled with changes to the inheritance tax, has raised serious concerns within the Scottish seafood processing sector.

In a joint statement, the Scottish Seafood Association and the Scottish Pelagic Processors’ Association say these budget changes threaten to undermine the government’s rhetoric about fostering economic growth across business communities and may have unintended consequences for businesses who are struggling to recover from the impact of the COVID-19 pandemic and recent high energy costs.

The statement says: “The proposed increases in National Insurance are expected to place an undue financial burden on employers, which could lead to difficult decisions regarding future staffing and investment. Seafood businesses who were hailed as key to food security during the pandemic are facing numerous challenges as they work to stabilise and grow in a post-pandemic environment. The additional strain from proposed higher National Insurance contributions may force many businesses to consider layoffs or reductions in workforce hours to control costs, ultimately stalling the economic recovery we so desperately need.

“Furthermore, the alterations to inheritance tax pose another significant risk. Although primarily focused on agriculture business, this tax is far wider and far reaching in affecting all business. By increasing the tax burden on families and businesses, the government may inadvertently limit the capital available for reinvestment in the economy. This move contradicts the government’s commitment to supporting businesses and promoting growth, as it creates a climate of uncertainty that can stifle innovation and expansion efforts.

“Food security remains a priority for the government, but the reality is that without a thriving food business sector, achieving this goal becomes increasingly difficult. Businesses are the backbone of our economy, and their ability to grow and create jobs is essential for ensuring food security and overall economic health.

“We urge the government to reconsider these budget changes and engage in meaningful dialogue with the business community. A collaborative approach is necessary to ensure that policies support growth, job creation, and economic stability.”