By James Rodger

Copyright birminghammail

Retailers say tax rises could further fuel inflation as shop prices jump. The British Retail Consortium, or BRC, says households are finding shopping increasingly expensive after annual shop price inflation rises to 1.4 per cent. Annual shop price inflation rose to 1.4% in September, up from 0.9% in August, according to the latest monthly report from the British Retail Consortium (BRC) and analysts NIQ. The warning is particularly prudent for shoppers at Asda , Sainsbury’s , Tesco , Morrisons and Lidl – five of the largest supermarkets in the country which are rivalled by cheapest supermarket Aldi . Helen Dickinson, the BRC chief executive, said: “Households are finding shopping increasingly expensive. READ MORE New 63-day council tax rule coming for millions of UK households “The impact on retailers and their supply chain of both global factors and higher national insurance and wage costs is playing out in prices for consumers.” Mike Watkins, the head of retailer and business insight at NIQ, said: “With inflationary pressures persisting, many shoppers remain concerned about their personal finances and are becoming increasingly price-sensitive.” after newsletter promotion “The new packaging tax, set to take effect in October, will put further upward pressure on inflation,” Dickinson said. “While retailers continue to absorb higher costs as much as possible and deliver value to customers, any further tax rises in the upcoming budget would keep shop prices higher for longer. “Ultimately, it is British households who will bear the consequences – positive or negative – of the chancellor’s decisions.” Speaking last week, Ms Dickinson said: “The Government risks losing the battle against inflation and working families are understandably worried. “With many people barely recovering from the last cost-of-living crisis, the Chancellor will want to protect households and enable retailers to continue doing everything they can to hold back prices. “The Treasury is currently finalising its plans to support the high street, including a much-needed reduction in business rates for retail, hospitality and leisure premises. However, the biggest risk to food prices would be to include large shops – including supermarkets – in the new surtax on large properties. “This would effectively be robbing Peter to pay Paul, increasing costs on these businesses even further and forcing them to raise the prices paid by customers. “Removing all shops from the surtax can be done without any cost to the taxpayer, and would demonstrate the Chancellor’s commitment to bring down inflation.”