Labour can boost growth at Budget says Asda boss - but it must change tack and ditch heavy high street taxes

See more This is Money on Google - save us as a Preferred Source Updated: 10:51 EDT, 28 August 2026 The boss of Asda has warned of a Budget 'tipping point' as Labour has the chance to boost growth instead of squeezing business with even more tax hikesAllan Leighton also threw his support behind Mike Ashley's scathing remarks on Andy Burnham's plans to revive the high street and urged him against heaping more taxes on larger retailers.The chairman's comments come as business leaders have started to set out their case to ministers ahead of the October Budget and as he revealed signs of a turnaround at Britain's third biggest grocer.He said the Budget was an opportunity for the new Prime Minister and Chancellor to shift away from a model of heavy taxes on business which inhibits growth to one that enhances it.'This is a real tipping point: instead of just talking about growth, the government now has an opportunity to change tack and actually make growth happen.' Asda boss Allan Leighton has said the Budget will be a 'tipping point' that could set the scene for future economic growth - or result in large firms finding it harder to investLeighton added that the next couple of months were 'critical' as consumers' confidence when they return from their summer holidays will 'set the scene for the rest for the year,' including the important Christmas trading period.It comes as Sports Direct Tycoon Mike Ashley this week said that it would be 'disastrous' to tax larger retailers more in order to fund discounts for other businesses like pubs.Burnham this week insisted he would 'take pressure off' businesses, which have complained about consumers having less cash to spend while their own operating costs have soared in recent years.His plans include funding business rates discounts for pubs and clubs by increasing business rates on online retail warehouses as well as tougher rules for vape and betting shops.Mike Ashley - whose stable of retailers encompasses House of Fraser, Flannels, Sofa.com, Jack Wills and Evans Cycles - said that it would be 'simply delusional' to tax larger retailers more through raising rates further.He lambasted a 'disastrous' approach to business rates and 'the dramatically increasing cost of employing people' as the biggest obstacles for businesses.Leighton said that Ashley's comments were 'absolutely right'.He added: 'All of the things that have been the policy so far have added cost to, not just retail, across the piece. And then that has reduced the profitability of those organisations, and therefore they've got less money to invest in growth. It's economics 101.'It comes as Leighton hailed signs of a revival at Asda, which has been struggling with falling sales since its takeover by a private equity firm a few years ago.Sales rose 0.2pc over the seven weeks to 18 August, in a return to growth for the first time in more than two years. Leighton called this 'an important milestone'.He said the group was 'about a third' of the way through its recovery, which has included slashing prices and a major online upgrade.But Asda said sales fell 2.3pc for the three months to the end of June, with revenue of £5.1bn.'I see this really as the sort of foothills of recovery still, but also the foothills of possibility,' Leighton added.Earlier this year, Asda accounts revealed that pre-tax losses had widened from £599million in 2024 to £989million in 2025, as total sales fell 3.4 per cent to £25.9billion.Leighton, who rejoined the Leeds-based retailer in November 2024, has warned that his revival plan will not be an overnight fix and slashing prices will hit profits.But he warned there was pressure on prices due to the heatwave impacting crops this summer.'The crops are in a tricky state, not just in the UK, everywhere, you know clearly and it's more a produce issue than anything else.'He said that the grocer had thousands of producers and growers and is 'working very hard with them' to ensure availability 'sticks up as well as we can' and to 'manage the inflation in the best way we can.''We generally inflate below the market anyway, so generally when there's high inflation, that's quite a good thing for us.'He added: 'But the biggest thing is consumer sentiment. How do people feel? Do they feel as if they want to spend? Do they have the money to spend? That's always been the driver of it.'DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.Compare the best investing account for you