Retailers demand action from Chancellor on business rates

A host of major retailers have called on the Chancellor to take action on business rates to revitalize the High Street.

With less than two weeks to go until the Autumn Statement, bosses from household names including Marks & Spencer, Sainsbury’s and Currys urged Jeremy Hunt to cut or freeze the benchmark used to calculate property tax bills.

Business rates are expected to rise by 6.7 percent next year.

According to lobby group British Retail Consortium, this translates into an increase of £470 million for British retailers.

There have been warnings that a big tax increase could force retailers to raise prices, defeating the government’s mission to reduce inflation.

Retailers have also raised concerns about what a heavier tax burden could mean for struggling high streets across the country, amid high vacancy rates and a scourge of shoplifting.

Stuart Machin, chief executive of M&S, branded the high rates as a ‘blocker to the regeneration of our towns and cities’.

Warning that further increases ‘risk diverting millions of pounds from ongoing investment to keep prices low and create jobs across the country’, he added: ‘The retail sector is being disproportionately hit by corporate interest rates, in a time when government inflation and consumers are still struggling with the cost of living.’

Speaking: Sainsbury’s boss Simon Roberts said the supermarket spends almost £500m a year on business rates

Echoing this sentiment, Sainsbury’s boss Simon Roberts said the supermarket spends almost £500 million a year on business rates, its biggest tax bill.

“If there is one issue I worry about that could hold back the fall in food inflation, it is the choices made in the Budget on business rates,” he told The Mail.

‘There is clearly a risk that any increase will put further pressure on food prices.’

The so-called corporate interest rate multiplier was frozen this year to offer companies some respite. But if no action is taken, it will rise in April next year.

Alex Baldock, CEO of Currys, said the retail sector is “overstretched” and that a rate increase would give Amazon “a free ride while UK retailers bear the burden, and while our city centers continue to be eroded.” Pubs and restaurants have also urged the chancellor to call off a planned increase in business rates, warning of a possible series of closures.

Television chief Tom Kerridge said the “harsh reality” was that hospitality businesses were struggling with rising costs and many would be forced to close without further government support.

More than 200 catering bosses signed a letter to Hunt, including Burger King, Fuller’s, Greene King and Mitchells & Butlers.

A Treasury spokesman said: ‘Inflation is falling and our priority is to halve it.

We continue to support our businesses which is why we have taken a total of a third of properties off business rates, spent billions on cutting retail, hospitality and leisure bills by 75 per cent and effectively cut corporation tax by £ 27 billion reduced through full spending. ‘