A host of major retailers have called on the Chancellor to deliver an industry-wide freeze for retail businesses of all sizes. .
With less than two weeks to go to the Autumn Statement, retailers body British Retail Consortium (BRC) has written a letter to Chancellor Jeremy Hunt to cut or freeze the metric used to calculate property tax bills.
Business rates are set to increase by 6.7 per cent next year. A recent report in Sunday Times states that Hunt is not expected to extend business rates relief for larger firms in the Autumn Statement and biggest retailers will be slapped with a £400 million increase in business rates next year.
The chancellor is understood to have decided against freezing rates for larger retailers despite warnings that an increase would cost jobs and push up prices.
BRC in its letter has told Hunt not to ignore the loud calls from retailers to support their efforts to keep prices down and invest in communities, and to freeze business rates for all retail businesses at the forthcoming Autumn Statement.
“All retailers expect an increase to place ‘some’ pressure on shop prices, with 59 per cent saying they expect it to add ‘significant’ pressure. All retailers said that an increase would hold back investment in communities, including opening new shops and warehouses, which creates jobs,” states the letter.
BRC research has shown the deleterious effect rates have on our villages, towns and cities, mentions the letter, adding that the country lost 6,000 stores between Q2 2018 and Q2 2023 and for two-thirds of those lost between 2019-21, business rates had a material impact.
“As things stand, business rates for retailers in England alone will increase by 6.7 per cent next April. Inflation is beginning to ease, but this represents an additional £480m on bills, at a time when retail businesses of all shapes and sizes continue to face elevated input costs, including from production, labour and energy.
“Failure to act by freezing rates for all retailers will undermine the Government’s anti-inflation strategy and longer-term plans for towns and communities. I note that the reports suggest you will prioritise Corporation Tax reliefs to promote investment. But for many retailers, it is business rates which act as the primary drag on their ability to invest in communities: this is because rates must be paid regardless of whether a business makes a profit or a loss,” states the letter by Helen Dickinson, BRC chief executive.