Business groups welcome Budget pledges

Industry bodies have broadly welcomed the measures announced by Chancellor Rishi Sunak in his first Budget on Wednesday (March 11) to support businesses this year in light of uncertainty over coronavirus.

Chancellor has suspended business rates in the coming financial year for any business with a rateable value of £51,000 or less. Businesses that are eligible for small business rate relief or rural rate relief will also be provided a £3,000 grant.

The freeze on alcohol duty has also been widely welcomed. However, there are concerns from several corners on the lack of support of large retailers.

Here’s how the various industry representatives reacted:

James Lowman, chief executive of the Association of Convenience Stores:

“We strongly welcome the Chancellor’s actions to reduce the burden of business rates in the short term. Ensuring that all businesses under £51,000 rateable value pay no business rates in the coming financial year will benefit the convenience sector to the tune of over £30m, and we look forward to hearing further details of the fundamental review in the Autumn.”

“The £3,000 grant will be of great benefit to over 18,000 of the smallest convenience stores who mostly trade in rural and isolated areas, helping them to continue providing an essential service to their local communities.”

Helen Dickinson, chief executive of the British Retail Consortium:

“The Chancellor has shown he is capable of making bold decisions, this will be critical to the upcoming review of the broken business rate system. We welcome the stated objectives of reducing the rates burden on business, something we have been calling for, and the inclusion of changes to transitional relief as an option to provide short-term relief from April 2021.

“It is vital that the burden is reduced for all retailers – large and small – if it is to promote further investment in productivity growth and higher skilled, better paid jobs. … The Chancellor has failed to provide any relief for larger retailers, who employ the majority of the industry’s 3 million workers and currently foot most of the industry’s £7.5bn business rates bill.”

Paddy Lillis, general Secretary of Usdaw:

“Today’s temporary business rates measures will be welcomed by small businesses, but they do nothing to provide a viable trading environment for the struggling large retailers who are closing stores, making staff redundant, going into administration and facing the prospect of going bust.

“The temporary removal of the Universal Credit income floor provides some assistance for the lowest paid who are self-isolating or recovering having contracted Covid-19. However, working families are desperate for large-scale reforms to Universal Credit, the system is fundamentally flawed and the roll-out has yet again been delayed.

“A formal review of business rates has been announced for the autumn. Usdaw is calling on the Government to engage with all stakeholders in this review and use the opportunity to deliver fundamental change and level the playing field between online retailers and shops.”

Andrew Goodacre, chief executive of Bira:

“We are delighted to see that the Chancellor listened to our concerns regarding the potential impact of Covid19. The retail discount being increased to 100%, the support with SSP and small business grants are all very welcome.

“We still have concerns for those retailers above the £51,000 threshold and believe that the threshold should be increased to include more smaller retailer businesses with less than 250 employees.”

Mike Cherry, national chairman of the Federation of Small Businesses:

“This is a pro-small business Budget, which has delivered a high streets bonus, a series of Conservative manifesto promises to small businesses, and emergency steps to support small firms through the coronavirus outbreak.

“Covering the cost of Statutory Sick Pay and emergency measures for the self-employed are particularly welcome. Removing the minimum income floor for those on Universal Credit will bring help to those working hard to keep their businesses going. These are vital contingencies for the UK’s 5.8 million-strong small business and self-employed community.”

Karen Betts, chief executive of the Scotch Whisky Association:

“We welcome the fact that excise duty on spirits has been frozen for nearly three years and the Chancellor’s announcement today that excise duty will not rise further. However, our industry needs continued support, through the upcoming review of UK alcohol taxation and while our exports remain subject to US tariffs.”

Miles Beale, chief executive of the Wine & Spirit Trade Association:

“The decision to freeze wine and spirit duty is welcome for British business, pubs and the wider hospitality trade. While he has not cut duty, it is reassuring to see that in his first Budget as Chancellor, Rishi Sunak MP, has taken steps to address the UK’s excessively high duty rates.

“The WSTA welcomes the comprehensive review of UK alcohol taxation. The current excise duty regime is complex and fails to support UK consumers, UK businesses – especially SMEs – or the Exchequer.”

Ian Wright, chief executive of the Food and Drink Federation:

“The UK’s food and drink manufacturers will have mixed views about today’s Budget. It is very welcome that the Government has listened to FDF’s call to extend the Climate Change Agreements (CCA) for two years. This will help businesses transition to the lower carbon economy we all want to see.

“It is very disappointing that government has decided to press ahead with the plastics tax. This will penalise many food and drink producers who are bound by strict food safety rules affecting the packaging they use. We urge the government to rethink how money raised through this tax can be used to transform the UK’s recycling infrastructure and will continue to work with them on the detail.”

“There will be many manufacturers, including producers of shortbread and dairy, that are badly affected by the punishing US tariffs on food and drink. They will be feeling perplexed as to why they do not qualify for the additional support outlined today. We urge government to re-assess the types of businesses who can access this support to ensure exporters across all regions of the UK can access essential support.