Over fifty retailers demand chancellor fix business taxation
High Street chains and shops sign a letter over business rates
Over fifty major retailers have come together to demand the Government takes action to fix the broken business rates system. In a letter to the new Chancellor, Sajid Javid, retailers called on the Government to put business rates at heart of the promised new economic package. The letter, coordinated by the British Retail Consortium, has been signed by major retailers including the CEOs of supermarkets, food-to-go, fashion, homeware, and department store retailers.
Retail remains the largest private sector employer in the UK, employing approximately three million people. The industry accounts for 5 percent of the UK economy, yet is burdened with 10 percent of all business taxes, and 25 percent of business rates.
The letter asks for four fixes that would address many of the challenges posed by business rates:
- A freeze in the business rates multiplier;
- Fixing transitional relief, which currently forces many retailers to pay more than they should;
- Introducing an ‘Improvement Relief’ for ratepayers;
- Ensuring that the Valuation Office Agency is fully resourced to do its job.
The letter notes that implementation of these four recommendations “could be undertaken quickly, would reduce regional disparities, remove barriers to the proper working of market forces, incentivise economic investment, and cut away at least some of the bureaucracy of the current system.”
The letter comes the day after BRC-Springboard data showed that UK Vacancy figures had risen to 10.3 percent, the highest since January 2015. It also comes shortly after the BRC-KPMG Retail Sales Monitor showed the 12-month average sales figures dropped to their lowest level on record, at 0.5 percent.
"Retailers investing in their businesses need support and incentives, not to be hit with increased business rates bills”, said James Lowman, Chief Executive, Association of Convenience Stores.
And Clive Lewis, Chairman of River Island, added: “We welcome the BRC proposals which offer short term solutions that can introduced quickly and will have immediate benefits to the struggling retail sector. In particular, the removal of downwards transition will allow all retail businesses to pay a tax which more accurately reflects the value of their properties. The burden that rates places on all High Street businesses not only stifles growth but is a major contributor to the closure of stores and the resulting decline in towns across the country.”
channels: brick and mortar retail, financial accounting, taxation
