Why it matters: The government's climbdown on welfare cuts puts pressure on Chancellor Rachel Reeves ahead of the autumn Budget, raising fears of further business tax rises when Suffolk firms are already facing their toughest trading conditions in recent years.
The big picture: Speaking to the BBC, Cabinet minister Pat McFadden insisted Labour will keep its election tax promises after ministers watered down planned disability benefit cuts to avoid a major rebellion. But experts warn the lost savings make tax rises increasingly likely.
Helen Miller from the Institute for Fiscal Studies said: "Come autumn, given the government has not been able to put through the cuts it wanted, it's looking increasingly likely that, if the government needs to do something, it's going to turn to tax rises."
The local impact: The Suffolk Chamber of Commerce's latest quarterly survey reveals that 74% of businesses are concerned about tax levels following the April changes to the Employer National Insurance threshold and the National Living Wage increase.
Doug Field OBE, chair of Suffolk Chamber's Economy Group, said: "The message coming through from Suffolk SMEs in particular is clear: trading is tough, future prospects uncertain and tax and price pressures still lie at the heart of many of these concerns."
The details: All trading measures in the survey remain negative, with more companies reporting declines than improvements.
Manufacturing firms experienced a six percentage point decline in domestic sales and a 12 percentage point drop in overseas sales.
Service firms reported slightly better trading activity but further declines in cash flow and profitability prospects.
What they're saying: Suffolk businesses submitted stark feedback to the chamber survey:
"Orders have slowed dramatically, enquiries are down in certain sectors. Wages and costs have risen disproportionately with cost of services achievable in the market"
"Confidence within our client base across East Anglia is at an all-time low"
"It has been a tricky start to the year, with the NI & NLW increases in April, so we have then had to pass the costs on to our clients"
What's next: Paul Simon, Suffolk Chamber's head of public affairs, said: "Suffolk businesses' message to the Government could not be clearer: there must be no more business tax hikes - of whatever sort - for the remainder of this Parliament."
The bottom line: With government finances under pressure and Suffolk businesses already struggling with rising costs, local firms are demanding protection from further increases that could worsen the county's four-year low in trading confidence.
