Today’s inflation figures mean retailers will be hit with a £137m hike in business rates from April next year, according to the British Retail Consortium.
The trade association said the increase would reduce the beleaguered sector’s ability to invest in businesses, staff and shops.
Consumer prices rose 1.7% year on year in September, matching the Consumer Price Index from August, which was at its lowest level since December 2016 following a sharp fall from 2.1% in July, the latest Office for National Statistics figures showed.
The Retail Price Index dropped from 2.6% in August to 2.4% in September.
The controversial business rates system is calculated every April based on the CPI of the previous September.
BRC property policy advisor Dominic Curran said the latest CPI announcement meant retailers would have to cough up an extra £137m from April.
“Already, while retail accounts for 5% of the economy, it pays a massive 25% of all business rates.
“This £137m increase will reduce the ability of retailers to invest in their business, their staff and their shops. The Chancellor must take action on rates in the forthcoming Budget and scrap ‘downwards transition’, which takes £1.3bn from retailers and uses most of it to subsidise rates in other industries. Meanwhile, with the retail industry facing store closures and jobs losses, the government should freeze the impending business rates increase.”
Legislation to increase the frequency of revaluations from five years to three years was scrapped when the government suspended parliament last month and was not included in this week’s Queen’s Speech.
No comments yet