The UK economy contracted by 0.3% in April, the sharpest monthly decline since October 2023, as rising business costs, household bills and falling exports to the US weighed heavily on growth. The drop surpassed economists’ forecasts of a 0.1% fall, highlighting mounting pressures on both businesses and consumers. Key contributors to the slowdown included increases in employers’ National Insurance contributions (rising from 13.8% to 15%) and other overheads such as council tax, energy, and water rates. At the same time, US tariffs triggered a record monthly decline in UK exports – particularly car manufacturing, one of Britain’s largest export sectors to the US, with one in eight UK-built cars typically destined for the American market. While the latest three-month GDP figure showed modest growth of 0.7%, economists warn that further tax rises may be on the horizon as Chancellor Rachel Reeves seeks to balance long-term investment plans with short-term budget pressures. Reeves has not ruled out future tax hikes, particularly as borrowing costs rise and council tax increases are expected to continue. Increases to minimum wages, business rates and National Insurance thresholds have pushed many employers to raise prices, further fuelling inflation concerns. For more information, please see BBC article