Chancellor urged to be radical on business rates

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Following this week’s Budget Statement, the ALMR has highlighted Government figures showing the scale of tax increases expected to hit pubs and restaurants over the next two years and urged the Chancellor to be more radical in his reform of business rates to lessen the impact.

HM Treasury’s ‘red book’ outlining the Government’s Summer Budget details a forecasted increase in business rates from £27.3 billion in 2014-15 to £32.9 billion in 2020-21 and the publication of responses to an initial review of business rates administration shows strong opposition from local authorities to any changes being made to the current regime.

ALMR Chief Executive, Kate Nicholls said: “Before the Election, the Chancellor promised ‘once in a generation’ reform of business rates and these figures published today show why that is so vital. Yesterday’s Budget Statement forecasts a steady increase in business rates receipts over the next six years, despite repeated warnings that this is crippling the UK’s high streets. Increasing bills by a fifth at a time when businesses will be prioritising investment in wages is frankly unsustainable and it is high street businesses like pubs, bars and restaurants which will bear the brunt of it.

“Business rates are the single biggest barrier to increasing competitiveness and productivity in the hospitality sector – an issue which the Chancellor says is a Government priority – so we urge him to be radical in his review of the regime as a whole and not be swayed by those calling for the status quo. If that is the outcome, then there is no way that small businesses in the sector will be able to step up to the challenge to invest more in training and teams that the Budget set us.”

The Government also published the responses to recent consultations on business rate appeals and administrative reform:

“The initial responses to the Government’s call for reform from other stakeholders do not make for particularly inspiring reading either. We are particularly concerned about a lack of appetite from local authorities for even minor changes such as more frequent valuations, streamlined forms and data collection that have met with some resistance and there is always a worry that any changes that may be brought in will not cut to the heart of the problem.

“We will await the Government’s response and welcome continued dialogue; but there needs to be a renewed focus from the Government and a clear plan of action to address this ongoing and substantial problem.”



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