Retail leaders have joined forces to call for urgent government action on business rates to prevent lasting damage to the industry.
In a letter to Chancellor Philip Hammond, seven different trade groups called on the government to commit to “fundamental change” to the system before it was too late to prevent damage to the economy.
The signatories, including the ACS, BRC and the Federation of Small Businesses, said upcoming uncertainty caused by Brexit had pushed the impact of rates to a tipping point.
“The fact remains that the burden of property taxation is too high. A system under which rates are the highest in the G7 and have risen from a third of rateable value in 1990 to half today is not financially sustainable,” said the organisations.
“Business rates will not cease to be an issue for businesses until we have a fair system of business taxation, which is internationally competitive and encourages investment.”
The groups set out their agreed stance that the overall burden of business rates is too high and revaluations need to be more frequent from 2020 onwards. They also argued that current RPI indexation is unfair and CPI indexation should be implemented beginning April 2018. In addition, they want the system to incentivise businesses that invest in and improve properties.
Last year the government committed to more frequent revaluations and a switch to CPI indexation from 2020, but the signatories want to gain support across all three main parties to ensure these pledges are not derailed by the upcoming election.
The letter concluded: “The business rates system will be a key factor in shaping investment and growth in the UK economy for decades to come. We respectfully ask the next government consider our views and to fundamentally reform business rates, making them fit for purpose in the future.”
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