Tesco plead with chancellor to let them profiteer in peace

Tesco boss Ken Murphy had the unmitigated gall to demand that chancellor Rachel Reeves refrain from raising business taxes in her upcoming budget. That’s in spite of the fact that Tesco has spent years jacking up the price of food well ahead of inflation – and raking in the profits from the results.

‘What we’d love to see’

There’s something sublime about the unmixed greed of a company like Tesco. One minute it can profiteer from a public feeling the cruel squeeze of the cost of living, then the next it cries ‘no fair’ at the threat of the government taxing those profits. It’s almost beautiful, in its way – like watching the sunlight on a wave right before it crashes into your home.

Tesco’s chief exec Murphy stated:

What we’d love to see is a Budget that’s pro-growth and pro-jobs which, as a result, will help customers with the cost of living.

We know that people are worried about what lies ahead and we’re seeing that in the consumer sentiment.

As a food retailer, we operate in a very competitive and very tough environment, and I think our one ask is don’t make it harder for the industry to deliver great value for customers.

In the last budget, the industry incurred substantial additional operating costs.

We’re doing our best to deal with them but enough is enough.

Oh please, we’re only asking one little thing – no more taxes please. The poor grocer (multi-national supermarket behemoth) is already under so much strain. Let’s put that into perspective, shall we?

Naked profiteering

Over the last five years, UK food prices have risen by 37%. Over that same period, Tesco’s operating profit has ballooned from £1.8bn in 2020/21 to £3.1bn in 2024/25. That’s an increase of a massive 72%.

More recently, the retailer posted an adjusted operating profit increase of 10.6% for 2024-2025 alone. This was far ahead of the 5.1% increase in the price of food in all retailers across the country in the same period, and even further above the 3.8% level of inflation overall.

Then, Tesco shares reached a 12-year high yesterday, 2 October. Its half-year sales (for the six months to August 23) went up 5.1%, reaching £33bn. The price of its individual shares went up by 5.3%. The retail giant now expects a profit of between £2.9 and £3.1bn for 2025 overall, up from a previous forecast of £2.7-£3bn.

In response to these glowing half-year results, Unite general secretary Sharon Graham said:

As millions of workers struggle to put food on the table, Tesco is raking in huge amounts of cash and paying out whopping dividends to shareholders.

Tesco has profited from the cost-of-living crisis, making a fortune through unfairly inflating grocery prices. The numbers are clear – in the past five years, food inflation has risen by 38 per cent yet Tesco’s operating profits have skyrocketed by 72 per cent. How can this be right?

It is time the Labour government stops being missing in action when it comes to tackling profiteering. Workers must no longer pay the price for corporate greed.

A modest suggestion

So, it looks like Tesco is gearing up to point the finger at Reeves if she has the temerity to raise its taxes. Of course, we couldn’t possibly expect the supermarket to take a hit to its profits – that simply wouldn’t do.

“Don’t make it harder for us to deliver great value to consumers” – at this point, they’re basically just announcing that any increase in taxes will be passed straight along to you, the jerk paying a fiver for a small pack of beef.

Fortunately though, there’s an easy way for Tesco to cushion the cost of a tax hike without punishing people who need to eat. Last year, Ken Murphy paid himself £4.7m in salary and bonuses. That’s 447 times as much as a full-time Tesco worker at the lower quartile of the workforce. In fact, it’s 431 times the salary of the median Tesco employee. If Murphy took a little pay reduction, down to match even just his average worker, he could save his company £4,689,095.

Now, that’s obviously a drop in the ocean compared to an expected profit of £3bn, but you know what they say – every little helps.

Featured image via Unsplash/Simone Hutsch