Retailers are “staring down the barrel” of a near-£300m hike in business rates next spring, as the latest inflation figures paved the way for a new financial bombshell.
The latest Retail Price Inflation (RPI) figures, published today, reveal that inflation continued to rise in August to 3.9%.
September’s RPI inflation rate, to be published next month, will be used to determine the uplift in business rates next April.
The BRC predicted September’s crucial RPI rate was likely to be at least 4% given inflation has already accelerated to 3.9% from 2% a year ago.
It said the surge in inflation would push up rates for retailers across the country by £280m next April.
“Retailers are staring down the barrel of a hefty £280m hike in their business rates bills from next spring,” said BRC director of business regulation Tom Ironside.
“It is highly questionable whether communities across the UK can afford a spike in business rates of this scale, and any resulting loss of commercial investment will contribute to fewer shops and fewer jobs. Nearly one in every 10 shops currently lies vacant and those in economically vulnerable communities in particular remain persistently empty, limiting the chances for these places to thrive.
“With the economy slowing, consumer spending facing headwinds and retailers responding to profound changes in shopping habits, the prospect of a further investment-sapping tax rise of this magnitude is deeply worrying and will only serve to make life tougher for high streets.”