Trade groups call for government action on business rates at Budget 2021
The UK government’s Chancellor of the Exchequer Rishi Sunak is due to give his Budget 2021 statement to the House of Commons on Wednesday 3rd March. Retail and trade bodies are calling on the Chancellor to extend the business rate relief afforded to retailers given the continued COVID-19 lockdown, whilst considering a radical overhaul of the business rates system in its entirety.
The Association of Convenience Stores (ACS) wants the Chancellor to extend the business rates discount well into the 2021/22 tax year, preventing local retailers from being met with sky-high business rates bills whilst getting to grips with life after the UK’s third COVID-19 lockdown.
The ACS provided evidence to HM Treasury in the build-up to Budget 2021, recommending cutting business rates in half for all retailers in 2021/22 to prevent a “cliff edge spike” in operating costs.
FSB and CBI united in the need for business rates clarity
The Federation of Small Businesses (FSB) wants the Chancellor to go further still with action on business rates in Budget 2021. Mike Cherry, national chairman of the FSB, insisted that “extending the business rates discount to 100%” for another 12 months was “the right thing to do”.
Mr Cherry added that the UK government must “recognise” that the impact of coronavirus and the subsequent lockdowns and social distancing measures have had a catastrophic impact on all businesses and is “not restricted to just retail, hospitality and leisure properties” but industrial, workshop and trade units too. Consequently, Cherry wants the Chancellor to “ensure relief reaches not only their supply chains currently excluded, but small businesses right across the country in all our communities and sectors”.
In addition, the Confederation of British Industry (CBI) also believes the business rates holiday should be extended for at least an additional three months. The body also wants the Chancellor to weigh up extending the Coronavirus Job Retention Scheme (CJRS) until the end of June, when the UK’s mass vaccination programme of all vulnerable citizens should be all but complete.
Tony Danker, director-general of the CBI, said that the UK government needs to “stand shoulder-to-shoulder” with firms big and small to help them through this crisis. Mr Danker said that “many tough decisions” will have to be taken by business owners in the coming weeks. He wants the government to “continue its [business rates] support” to give businesses much-needed breathing space.
The CBI is also suggesting that the government goes further still on business rates by weighing up implementing a long-awaited reform of a system it deems “outdated” for Britain’s high streets.
Its campaign, titled “Progressive business rates that work for everyone” says that the current business rates system “does not reflect digitisation” and “changing business models” in the 21st century.
Anna Gascoyne, director of economic policy at the CBI, says the “right system” would give business owners the ability to “invest in the factories and offices where we work” and “support the communities we live in”. This so-called “legacy tax” is one which the CBI wants to see overhauled to give businesses the flexibility to recoup investment costs in their properties before experiencing a rise in business rates based on the unit’s new valuation.
Pall Mall Estates have a wide range of low cost commercial properties across the UK.