Shoe Zone has confirmed it plans to close 20 or more of its stores across the UK to mitigate the impact of tax changes announced by Chancellor Rachel Reeves in the Autumn Budget. However, the company has not clarified which locations are at risk of being permanently shut down.
Earlier this week, the high street footwear retailer cited the looming hike to the National Insurance rate for employers, which is being raised from 13.8 per cent to 15 per cent, as to why store closures may be a necessity.
The Chancellor claims the tax increase is necessary to plug a £22billion “black hole” in the public finances but the move has been slammed as a “tax on jobs” by the business community.
This latest update from Shoe Zone comes amid the recent wave of store closures with 10,500 shops permanently closing last year alone, according to the Centre for Retail Research.
In its latest financial statement, the business admitted it was operating in “very challenging trading conditions” with the pending changes to National Insurance contributing to Shoe Zone’s struggles.
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Shoe Zone is closing stores – but is your local shop shutting down?
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Rachel Reeves announced future changes to National Insurance in her Autumn Budget
PA
Following yesterday’s base rate announcement, the Bank of England cited the Budget as contributing to a collapse in consumer confidence which had led to the economy taking a hit.
The central bank’s Monetary Policy Committee (MPC) shared that it was “considering the impact on growth and inflationary pressures from the measures announced in the Autumn Budget”.
Among the changes rolled out in Reeves’s fiscal statement included an increase to the National Living Wage and an overhaul of the inheritance tax (IHT) regime, as well as the proposed National Insurance raid.
Committee members voted six to three for the country’s interest rate to be held at its current level of 4.75 per cent in a blow to mortgage holders and debt borrowers. The Chancellor defended her fiscal agenda following the Bank’s decision.
She explained: “I know families are still struggling with high costs. We want to put more money in the pockets of working people, but that is only possible if inflation is stable and I fully back the Bank of England to achieve that.
“Improving living standards across the country is our number one focus, and is why I chose to protect working people’s pay slips from tax rises, froze fuel duty and increased the National Living Wage for three million people.”
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In its latest financial update, Shoe Zone stated: “Consumer confidence has weakened further following the Government’s Budget in October 2024, and as a result of this Budget, the Company will also incur significant additional costs due to the increases in National Living Wage and National Insurance.
“These additional costs have resulted in the planned closure of a number of stores that have now become unviable. The combination of the above will have a significant impact on our full-year figures.”
For the year to September 27, 2025, the high street staple projects profits will be “not less than” £5million which would be half than the £10million previously forecast by the firm.
Across its wider portfolio, Shoe Zone is made up of 112 high street stores and 185 larger format stores. The shoe store sells brands such as Skechers, Hush Puppies, Rieker and Lilly & Skinner.
