Peel Hunt has stated that new taxes will have “a disproportionate impact” on Britain’s small businesses, creating “an increasing gulf” between large and small operators in both confidence and performance.

The UK investment bank and economic analyst warned that though larger groups are able to absorb costs, SMEs will continue to be battered by upcoming levies such as the Tourism Tax.

“Scale brings competitive advantages in areas like the ability to invest, drive cost efficiencies, churn assets and move sites between different operating models,” said a spokesperson.

“While new taxes and regulation have a disproportionate impact on small operators, many larger operators are continuing to perform strongly and should show their resilience in the coming months.” 

The bank described the visitor levy as “another negative investment in the sector,” citing estimates from Tax Policy Associates that the tax will cost £689m in lost spending.

“The cost of this to the economy and the Treasury will be a function of the resultant lost investment, closures, job losses, reducing tax revenue and raising unemployment benefits over the long term.” 

“The losers are set to be hotels and pubs with rooms, and families that continue to holiday in the UK during school holidays, when surge pricing will add to the misery.”