The British Independent Retailer Association (Bira) has said it is ‘pleased’ the Chancellor of the Exchequer has announced a 50% business rates discount for one year in his Autumn Statement today (Wednesday, October 27, 2021).
The discount, which is worth up to £110,000 for retail and hospitality businesses, was one of several pledges made by Rishi Sunak to help boost the high street. The Chancellor said in the House of Commons that: “Pubs, music venues, cinemas, restaurants, hotels, theatres, gyms, any eligible business can claim a discount on their bills of 50%, up to a maximum of £110,000.”
Alongside the Small Business Rates Relief, the Chancellor claims his measures will deliver a discount of at least 50% to 90% of all retail, hospitality and leisure businesses.
He added: “Apart from the Covid reliefs, this is the biggest single-year cut to business rates in 30 years. We’re unleashing the dynamism and creativity of British businesses with a simpler, fairer, more competitive tax system.”
Other measures announced in Parliament included:
Next year’s planned increase in the business rates multiplier will be cancelled
Making business rates fairer and timlier’ with three-year evaluations from 2023
Introducing investment relief for green technologies: solar panels for 12 months
New rates improvement relief from 2023 and businesses will pay no extra business rates on improvements made to a property.
In his statement, Mr Sunak said it would be ‘irresponsible’ to scrap business rates completely, although it is an election pledge of the Labour Party.
Bira CEO, Andrew Goodacre, commented: “Whilst we would have liked to have seen a more fundamental review of business rates, we are pleased to see some respite for the smaller, independent retailers.
“The retail discount for business rates was a positive move when first introduced in 2019 and it is right that it is now re-introduced. We also think that the incentive to encourage investment in equipment tor reduce the carbon footprint of shops is a good idea.
“Prior to the Budget Bira called for support for business rates, incentives for zero carbon initiatives and investment in the transport infrastructure. It looks like the team at the Treasury have been listening and we will continue to push for the more fundamental reform of business rates on behalf of our members.”
Andrew also raised concerns about the future burdens on retailers once full rates return, adding: “The rates bill for this year was reduced to 25% (of normal levels). This was done in response to Covid. Reducing rates by 50% next year is in fact a 100% increase on what businesses are actually paying. On top of everything else, this will be a challenge.”
Yesterday, Bira raised concerns that the statement would not meet the needs of the independent retailer. Bira’s number one request is that business rates are permanently cut to reduce the burden on independent retailers still struggling to recover from the pandemic, many of which are saddled with extra debt accrued during lockdown.
“Something has to be done to ease the cumulative cost burden being faced by small retailers. Doing nothing is the clearest sign yet that the Government is writing off physical retail,” said Mr Goodacre.
Bira is also concerned about the potential rise in the National Minimum Wage (NMW).
Andrew said: “Responsible employers want to see employees earn a fair wage. We expected the NMW to increase above inflation as this was proposed by the low pay commission some time ago. However, we have again missed the opportunity to reduce the burden on employees by not increasing the national insurance allowance. Such a move would still allow employees to earn more whilst reducing the cost to employers.”
