The British Retail Consortium has explained its decision to end calls for a freeze on business rates.
The BRC said today such a move was an “unrealistic ask” as it would cost the Treasury an estimated £1bn a year to apply the freeze to all business rates payers. The organisation is now seeking a wider reform of the rates system, while calling for a 2% cap on business rates.
“We recognise that almost £1bn a year is a big ask. And even if there was a freeze, what has become increasingly apparent is that it wouldn’t be enough to address the significant issues that business rates are causing to local jobs and communities,” said the BRC’s director general Helen Dickinson.
“What needs to happen is reform of business rates, and that is now our focus. We agree with the CBI that there should be a 2% cap while this detail is being worked through.”
In a letter to senior executives of BRC members, Dickinson added: “We aim to achieve this by marshalling a range of arguments demonstrating that the current system is no longer fit-for-purpose, damaging to our high streets and town centres and that it inhibits the sector’s ability to invest, create jobs and drive growth.
“As we up our activity over the coming weeks and continue to make the case for reform, we are also gathering evidence to inform our recommendations for changing the business rates system, which we hope to share in early spring, by which time our goal is to have moved HM Treasury from its current intransigent stance to one which is receptive to the idea of reform.”
Martin Blackwell, CEO of the Association of Town and City Management, backed calls for the modernisation of business rates: “Business rates are of course a crucial part of creating this environment, and we note the BRC’s stance on this issue.
“At the ATCM, we represent members from the private, public and third sectors, and going forward we will continue to strongly recommend that the UK government considers the modernisation of the business taxation system. This means government working closely with industry to ensure that business rates are fair and proportional. There is there no doubt that the system needs fundamental change to better reflect the modern business world.”
Separately, it was announced today that Lidl was joining the BRC. “Lidl has experienced tremendous growth within the UK retail sector in recent years and we are excited about the opportunities our membership to the BRC will bring. We are looking forward to being able to benefit from the BRC’s campaigning and policy expertise in areas affecting our business,” said Lidl UK managing director Ronny Gottschlich.