Retailers told to expect £170m increase in business rates
today Sep 2, 2019
High street retailers could see their business rates bill increase by £170 million next year as experts predict a 2.1% increase in line with the current inflation rate.
In total, high street businesses could face an increase of more than £660 million, with shops, supermarkets, pubs, restaurants, hotels, offices and factories all expected to feel the weight of the new rates.
The widely criticised UK business rates system taxes companies based on the buildings they occupy. It has been blamed for the demise of the high street alongside muted consumer demand and political uncertainty.
The annual increase will come into effect in April 2020.
Real estate adviser Altus Group said that a 2.1% increase would mean an additional £170 million increase in rates for the retail industry.
The exact increase will be revealed next month, when the September Consumer Prices Index (CPI) is released. This is the figure used to determine annual rate rises.
Many industry experts and trade bodies have complained that business rates are giving online retailers an unfair advantage, as taxes on warehouses are generally lower than on prime retail locations.
Altus Group head of UK business rates Robert Hayton said: “With major retail and hospitality businesses reducing their estates and headcount often citing high level of rates as a contributory factor, I urge the Chancellor to take the bold and ambitious step of being the first Chancellor to freeze the multiplier since the national business rates system was introduced in 1990.
“It would be a positive message to business from the Johnson administration and a real statement of intent post-Brexit. It would help all other sectors too, such as manufacturing, who are also hurting.”
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