The British Retail Consortium had called for a two-year freeze on the business rates increases, describing the current system as “unsustainable”.
According to the BRC, the retail industry accounts for 5% of the economy but pays nearly 25% of the overall business rates bill, at more than £7bn per year.
“This is a disproportionate burden and is leading to decisions to close stores, while at the same time getting in the way of the modernisation and reinvention of Britain’s high streets,” the lobby group said.
A freeze on a rates rise would provide relief for the retail industry at a time when it is under significant cost pressure and is going through a period of transformation driven by technology and changing consumer behaviour, the BRC argues.
BRC ceo Helen Dickinson said: “The current business rates system is not fit for purpose. It is a 20th century answer to a 21st century problem. Retail shoulders far more than its fair share, and the rates bill is leading to store closures and getting in the way of reinvention of our high streets.
“The BRC is calling on government to freeze business rates until the 2021 revaluation to relieve the burden of this unfair tax on retail businesses and allow time for dialogue about the wholesale modernisation of business taxation. This would be welcome government support for the country’s largest private sector employer at a critical time.”