Try out the British Chambers of Commerce's new calculator to see how much policy changes are affecting your business

The British Chambers of Commerce has launched a free online calculator. It shows how much extra a business is paying because of decisions made by government since 2016.

The BCC is the national body for the UK's chambers of commerce. It represents about 50,000 businesses.

Its figures show a typical mid-sized firm with 50 staff and £5m of turnover now pays around £1.98m a year in costs created by government policy. In 2016 the same firm paid £1.16m. That is £827,000 more each year, a rise of roughly 70%.

The BCC says the increase is permanent rather than a blip. Stripping out inflation, these costs have gone from about 32% of a typical firm's sales to 40%.

Shevaun Haviland, director general of the BCC, said: "Our Budget test is simple. Will it reduce costs for business and increase confidence? If it does, we will support it. If it doesn't the economy will falter."

What is pushing the costs up?

The BCC points to four main costs.

The first is employer National Insurance. This is a tax a company pays on its staff wages, on top of the wages themselves. It is separate from the National Insurance taken off an employee's payslip.

The second is the minimum wage, which has gone up every year.

The third is business rates. That is the tax paid on shops, offices, workshops and other commercial property.

The fourth is new reporting rules, including Making Tax Digital. This requires tax records to be kept and filed online.

Which change cost firms the most?

The National Insurance changes announced in the 2024 Budget. The BCC says those alone made up a quarter of the whole decade's increase.

From April 2025 the rate a company pays rose from 13.8% to 15%.

At the same time, the wage level at which the tax starts dropped from £9,100 a year to £5,000. That means firms now pay the tax on a much larger part of each wage.

Together those two changes add about £800 a year for every full-time member of staff on the minimum wage.

The minimum wage itself went up on 1 April 2026, to £12.71 an hour for workers aged 21 and over and £10.85 for 18 to 20 year olds.

Sick pay rules also changed on 6 April 2026. Staff now receive statutory sick pay from their first day off work. The previous three-day waiting period has been removed.

The BCC says wage costs are now the biggest price pressure for 70% of firms, and that firms' plans to invest are at their weakest since the pandemic.

How much of this applies to a small company?

The £827,000 figure describes a firm much larger than most Binq users. The same costs apply to businesses at any size, but one of the main discounts works differently for very small companies.

It is called the Employment Allowance. It reduces the employer National Insurance bill by up to £10,500 a year.

At the 15% rate, £10,500 wipes out the tax on about £70,000 of wages above the £5,000 starting point. That is roughly three and a half full-time staff on the minimum wage.

So a company with five staff on £25,000 each would face an employer National Insurance bill of about £15,000. The Employment Allowance brings that down to around £4,500.

There used to be a rule blocking any firm with a National Insurance bill above £100,000 from claiming. That was scrapped in April 2025, so most small and medium firms now qualify.

Two rules still apply. The allowance is not given automatically and has to be claimed every tax year through payroll software, although claims can be backdated four years.

And a company cannot claim it if a single director is the only person on the payroll.

What does the calculator not cover?

Only costs created by UK government policy. Tariffs, general price inflation and changes to trade since Brexit are all excluded. The full rise in the cost of running a business is therefore higher than 70%.

What happens next?

The Chancellor's first Budget is due in the autumn. The BCC is calling for lower business costs and will publish its full list of Budget requests in mid-September.

You can try out the calculator at: Cost Stack Calculator - British Chambers of Commerce