Industry welcomes Chancellor business rates message, but calls for greater reform
Industry bodies have welcomed continued business rate relief announced in yesterday’s Autumn Statement, but urge that more needs to be done to reach reform.
Chancellor George Osborne’s Autumn Statement announced a relief on business rates for small businesses will continue for another year. This means businesses with a value under £18,000 or £25,000 in London, can claim half of their business rates back for one more year.
Helen Dickinson, British Retail Consortium director general, welcomed the news, but said the rates system needed complete reform: “We very much welcome the commitment to undertake a comprehensive review of the business rates system. We want a system that brings investment and jobs to the high street without punishing retailers who trade online. The retail industry is the largest rates payer, contributing over a quarter of the total rates tax take.
“Today’s short-term support package will be of enormous help to those struggling to keep their businesses open on the high street.
“As the HM Treasury sit down to draw up the terms of reference for the review they should look to the BRC’s Manifesto Milestones for how to reform the rates system. In it, we set out four principles of fundamental reform which include:
• The total amount of business rates should be reduced
• Business rates should flex with overall economic performance as other taxes do
• Business rates should be shared equitably across different industries
• The system should have positive incentives such as encouraging energy efficiency.
“We look forward to playing a full part in the discussions that will take place with government on the reform of the system.”
Meanwhile, John Rogers, Sainsbury’s chief financial officer and chair of the BRC industry-wide group, looking at the issue of business rates, also welcomed the news: “We welcome the full review of the structure of business rates. A clear consensus has emerged across businesses of all sizes and from all sectors – our current outdated system of business rates isn’t just a retail problem, but a business problem. We will be fully engaging with the review to ensure we get a new system which is fit for purpose in the 21st century.”
However, the National Farmers’ Union (NFU) criticised Osborne’s focus on boosting economies in northern cities, stating business investment should be encouraged country-wide.
“The Chancellor again suggested a need for a more balanced national economy, but confined this to building a northern powerhouse in northern cities. We think there is a need to encourage business investment and growth in productive capacity throughout the whole of the UK. It is disappointing that no mention was made of the annual investment allowance or encouraging investment in business infrastructure or managing business volatility – some of the NFU’s key asks in our submission,” said NFU policy director Andrew Clark.
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- business rates
- george osborne
- chief financial officer
- autumn statement
- rates system
- northern cities
- business investment
- brc industry wide
- industry wide group
- wide group looking
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