The government has launched a fundamental review of business rates so the system “better reflects changes in the value of property”.

Launched by chief secretary to the Treasury Danny Alexander MP, the review will also look at how businesses use property and what the UK can learn from other countries about local business taxes. 

”Our system of business rates was created nearly 30 years ago. Since that time, the worlds of commerce and industry have changed beyond recognition,” he said.

”I’ve been impressed by the representations made by the business community and I know that business rates are a considerable cost.”

Responding to the launch of the reivew, the Association of Convenience Stores called for greater support for small businesses and the high street.

ACS chief executive James Lowman said: “We welcome this overdue review, and we are pleased that it will take a look at radical options for reforming the outdated business rates system. The review must deliver help for high streets, be simpler than the current system, and offer incentives for investment rather than penalising businesses which improve their premises.

“Increases in business rates can make the difference between a local shop being viable and closing down. This review must look at the overall income from business rates, and allow it to change with economic cycles, rather than always increasing as is currently the case.”

The government has undertaken a number of reviews of business rates over the last two years including the administration process for rates and a selection of short term measures including targeted reliefs for retail premises and capping annual increases in rates at 2%. 

The review will report its findings ahead of the 2016 Budget.