Firms are pausing hiring new staff while executives are selling off shares in UK-listed companies amid worries over the possible impacts of the chancellor’s first budget, it has been claimed.

Business body the CBI said on Friday it was “clear” that some firms were holding back from employing new staff and making investment decisions until there was “more clarity” about the measures.

Separate research also suggested some are selling off shares and bonds amid speculation over potential revenue-raising measures from Rachel Reeves on 30 October.

It comes after the Prime Minister Sir Keir Starmer warned the budget was “going to be painful” following claims there is a “black hole” in public finances.

While details of the budget are yet to be revealed, Labour has vowed taxes on “working people” – such as income tax, VAT and national insurance – will not go up.

However, reports suggest the chancellor is considering other rises, such as an increase in capital gains tax.

The tax, which applies to the profit someone makes when they sell an asset that has increased in value, could be increased to as much as 39%, according to The Guardian.

Capital gains tax is currently between 20% and 28% – depending on the asset – for those who pay higher rates of income tax.

Wealth management firm Evelyn Partners said nearly one in three business owners had fast-tracked exit strategies – a term used to describe when an owner sells their stake in a firm – over the past 12 months.

Its survey of 500 owners of businesses with annual revenue of more than £5m found nearly a quarter had done so due to worries over capital gains tax hikes, while 20% expressed concern over fears of cuts to inheritance tax relief.

Laura Hayward, a tax partner at Evelyn Partners, said: “The prime minister’s statement that the upcoming budget would be ‘painful’ has put owner-managed businesses on edge and this has prompted many to want to exit as quickly as possible.”

Separate research by AJ Bell has also found that directors at UK-listed companies have sold off more than £440m worth of shares since the general election in July.

The rate of disposals has also been double that of the previous six months, the investment platform said.

Russ Mould, a director at AJ Bell, said: “It is possible that speculation around changes to the tax regime ahead of the budget may also be focusing a few minds.”

Meanwhile, the world’s biggest custodian bank BNY said its clients had sold off £3bn of UK government bonds in September at the fastest pace since 2022.

Analysts said concerns over the chancellor possibly changing fiscal rules and increasing spending was likely a factor.

Geoff Yu, a senior market strategist at the bank, said: “While there can be many reasons for such sales, including changing Bank of England expectations, investor exposures to UK gilts have been reduced heading into the upcoming budget.”

Read more from business:
Port giant pulls £1bn announcement
UK economy returns to growth
US national debt heading for historic highs

Ben Jones, the CBI’s lead economist, CBI, said: “Our surveys suggest that businesses may have tapped the brakes again in September amid speculation over potential budget announcements.

“Anecdotally it’s clear that some firms have paused hiring and investment decisions pending more clarity over the direction of the new government’s economic policies.”

When asked on Sky News earlier on Friday about the possibility of a rise in capital gains tax, government minister Pat McFadden said: “The budget’s not for another few weeks. And, sadly, I predict that there’ll be speculation about all sorts of budget measures over the next few weeks.

“The only sensible answer I can give is [that] the chancellor will make her announcements when she stands up to give the budget… it’s not sensible for me or any other minister to get drawn into speculation”.