The retail industry has called on the Chancellor to overhaul business rates when he makes his Budget statement on March 20.

The Association of Convenience Stores (ACS) has urged George Osborne to cap business rates increases following results of its Voice of Local Shops survey which revealed that 45% of retailers believed business rates were a major obstacle to success for their store, more than those concerned about crime, taxation and obtaining finance combined.

ACS chief executive James Lowman said the government needed to act to protect the future of small businesses. “If the government wants to have a long term positive impact on small businesses across the UK, they must cap the rates increase at 2%, bringing it in line with the council tax cap and the government’s own targets for inflation,” he said. “Allowing these unpredictable hikes to continue will send a clear message that the Chancellor has failed to recognise the importance of the retail economy.”

Alkesh Gadher of Best-One Isleworth, London, said the continual rates increases were hindering his business growth. “Any rise in outgoings is money off your bottom line and prevents the business from moving forward,” he said. “These costs are also very difficult to fight, we’re in the middle of a ratings revaluation but it’s a long process to go through.”

Alkesh said the government also needed to look at the level of employment red tape for small businesses. “The burden is on the employers and it’s creating more and more work for us,” he added. “We have 11 staff members that will need to have pensions organised for them so it’ll be either up to us to arrange that or we’ll have to pay our accountant to do it which is yet another cost.”

The Federation of Small Businesses national chairman, John Walker, also called for a budget that benefited small businesses.

“With the economy only growing a fraction in 2012, the Chancellor must deliver a Budget that is unashamedly focussed on boosting small business,” he said. “What we need to hear on March 20 is not more small-scale policies which tinker at the edges but measures that will have a tangible effect both immediately and in the long-term. Making it easier to find investment relief, simplifying the tax system and making small business rates relief permanent should be the Chancellor’s priority.”