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Why Business Rate Relief Can Preserve London's Cultural Heritage

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In April this year, the Government's new business rates came into force, causing considerable worry amongst the capitals many small business owners. On average, rates rose more than 23%, with some boroughs experiencing rises of more than double this figure.

Following a widespread outcry, a £300 million fund was launched to try and help businesses adapt to the sudden increase. However, concerns remain that this amount is insufficient, and further changes are needed in order to preserve London's economy and cultural heritage.

Current Situation

The shockwaves from the rate hikes are still being felt. Many small companies are operating in tough trading conditions and require rate relief to stay in business – some established firms have already planned for closure.

Recently, the Federation of Small Businesses lobbied the Government, issuing a report calling on them to act quickly and reform the business rates system, believing that relief of £20,000 is more appropriate than the current £12,000 threshold.

Some councils are thankfully making good use of the support fund available to them. Camden Council are one of the first to act and have sent revised bills to small businesses to try and steer their local economy through the turbulence.

Shops and Supply Chain

Unfortunately, many of the worst hit boroughs are also the areas with the most small businesses. Tower Hamlets is facing a rise of 56%, which could cause some of the retailers on the iconic Brick Lane to struggle. Of course, shop and restaurant closures would also affect tourism and reduce spending, resulting in further economic turmoil.

However, the impact is not merely restricted to the retail industry, as their supply chain would also be affected. There are an abundance of wholesalers and manufacturers situated around the capital that face not only their own rates rise, but also the prospect of reduced orders from retail outlets – a double whammy that could have disastrous consequences, and cause a large number of job losses.

Cultural Impact

One of the more worrying aspects of the rate change is the effect it might have on the cultural sector. In the West End, London's theatreland's total rates bill is forecast to rise nearly 40%. In addition, music venues across the capital are under threat because of the crippling charges.

If even a small proportion of these businesses close, it is easy to see how our cultural facilities could be badly affected. Indeed, if some of these premises are forced to shut, then it is possible they may never return.

Simply put, if more councils follow Camden's lead, and quickly offer rate relief now, then hopefully there will be minimal casualties, and London's heritage can be protected for years to come.

At Pall Mall, we are helping to support businesses throughout this period of instability by operating a flexible lease system. There are no long-term, financially restrictive contracts, which gives you more flexibility when you need it most.

If more councils follow Camden's lead, and quickly offer rate relief now, then hopefully there will be minimal casualties, and London's heritage can be protected for years to come.

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