15 July 2024, 03:46
By Furniture News Nov 16, 2023

Rates rise threatens future of town and city centres, states business coalition

A coalition of leading hospitality, retail and leisure organisations have written to the Chancellor urging him to freeze the business rates multiplier and extend existing reliefs for a further year at the upcoming Autumn Statement.

British Retail Consortium (BRC), UKHospitality, Association of Convenience Stores, British Independent Retail Association (Bira) and ukactive are warning that businesses, jobs and the future of high streets are at risk without the measures.

The sectors combine to pay more than £10b in business rates a year. The inflation-linked increase to the business rates multiplier will cost retail businesses £480m and hospitality businesses £234m. An end to current relief will cost hospitality £630m and retail £750m.

In a survey of BRC members, 66% of retailers responded that they were ‘very concerned’ about an increase in businesses rates, with 69% saying it would place ‘significant pressure’ on the prices paid by customers.

A recent survey of UKHospitality members showed that 66% of businesses would reduce investment, 61% would raise prices and 41% would reduce opening hours if rates relief was removed. Members of ukactive reported that 75% were ‘extremely likely’ to have to increase customer pricing in the next six months, with 88% having already been forced to raise prices over the past year. 

The joint letter warns of the ramifications of such dramatic increases in business rates, stating: “An inflationary increase in the business rates multiplier and removal of reliefs would be disastrous for our sectors. It will mean business failures, job losses and boarded-up properties in our high streets, denying people their livelihoods and their social pleasures.”

Helen Dickinson, chief executive of the BRC, says: “Retailers are staring down the barrel of a £480m-a-year hike in their business rates bills from next spring. Such a hefty increase will threaten to put renewed pressure on retail prices, as well as block new investment in our town and city centres. It is essential that the Chancellor uses the Autumn Statement to freeze business rates and give our local communities a fighting chance to thrive.”

Andrew Goodacre, CEO of Bira, comments: “Independent retailers are finding life on the high street incredibly difficult. Significant increases in interest rates have reduced consumer expenditure, and in the first half of 2023, 21,000 independent businesses closed.

“The current 75% retail discount on business rates must be retained, as those smaller retailers cannot afford any increases in costs – many of them are still dealing with +10% increases in their rateable values earlier this year.”

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