Independent retailers across the UK are facing business rates increases of up to 15% next year despite the Government’s promises of the “lowest tax rates since 1991,” a leading trade association has warned today (1 December).
The British Independent Retailers Association (Bira) said the reality of last week’s budget has fallen far short of the “transformation” pledged by ministers, with most independent shops set to pay considerably more in rates despite new lower multipliers.
Andrew Goodacre (below left), Bira CEO, said the government had used the rates revaluation to mask what amounts to “tinkering around the edges” rather than genuine reform.
“We were promised transformation, but what we’ve got is a system that will see most independent retailers paying 15% more in business rates next year - way above inflation,” said Goodacre.
“Even with transitional relief and small business support, shop owners are facing substantial increases at a time when they’re already squeezed by rising wage costs and unfair competition from overseas sellers.”
Original Government proposals suggested multiplier reductions of up to 20p for properties with rateable values below £51,000 and up to 10p for those above that threshold. However, the actual reduction delivered was just 5p.
Bira analysis shows that a typical independent shop with a rateable value rising from £30-39k will see its bill increase from £8,982 to £10,329 - £1,347 or 15% - despite being eligible for the new “permanently lower” small business multiplier of 38.2p and transitional relief.
An even smaller shop with rateable values rising from £15-20k will face the minimum £800 cap increase, taking bills from £4,491 to £5,291.
“The fact these complex transitional reliefs are even needed shows that business rates still requires wholesale reform. The government took advantage of the rates reassessment to deliver minimal real support while claiming to have transformed the system,” Goodacre added.
“There are serious questions for the Valuation Office about how shops on the high street see their valuations soar while superstores on retail parks get lower valuations,” said Goodacre. “It doesn’t make sense and frankly feels like a betrayal of the Government’s stated aim to support the high street.
“This Budget was supposed to level the playing field. Instead, it’s made the pitch more tilted against honest businesses…”
“Independent retailers are facing a perfect storm. Higher wage bills, business rates going up not down despite the promises and another four years of being undercut by overseas sellers dodging duties and safety standards. This Budget was supposed to level the playing field. Instead, it’s made the pitch even more tilted against honest businesses on our high streets.”
No comments yet