Business confidence rises but concerns over taxes remain

02 Sep 2025

Confidence amongst business leaders rose to -61 in August from -72 in July, the Institute of Directors (IoD) has found.

The IoD's Economic Confidence Index, which measures business leader optimism in prospects for the UK economy, also showed that directors' confidence in their own firms rose to +1 in August from -9 in July.

The data revealed that revenue expectations rose to +12 from -8 and cost expectations remained steady at +85.

Anna Leach, Chief Economist at the IoD, said: 'Business leader confidence has picked up slightly from July's record low, but only to levels seen after the 2024 Budget and during the early pandemic. Hiring and investment expectations continue to swing back and forth as April's tax rises ripple through the economy, while cost pressures remain stubbornly high.

'It comes as little surprise to see taxes and the wider economic climate dominating concerns amongst business leaders.'