BRC suggests ideas for complete reform of business rates
Ground breaking ideas for the complete reform of the UK business rates system have been published today by the British Retail Consortium.
The Road to Reform Report contains ideas such as replacing the current tax system with a tax based on alternative measures such as energy use, and introducing a simplified, banded revaluation system with revaluations on a more regular basis.
The BRC said the range of options, which have been developed with BRC members and consultancy firm EY, are intended to create “imaginative and innovative debate” to feed into the Chancellor’s Discussion Document.
The organisation has long argued that the current system of business rates creates disincentives for investment in property and as a result the system is now levying a higher burden on a smaller number of businesses.
Never Miss a Retail Update!The BRC believes the proposals could ensure customers continue to benefit from competition, provide positive incentives for retailers to invest in property, support the regeneration of the high street and create more jobs to add to the three million people already employed in the industry.
BRC director general Helen Dickinson said: “We have a once in a generation chance to fundamentally change the business rates system and the time is right to think creatively and in the best long term economic interests of the UK. These potential options would be good for the public, the economy and businesses small and large, while still providing significant tax revenues for the Government. We now intend to analyse each one in more detail and very much hope that we will stimulate discussion that goes beyond tinkering with the existing system.”
Sainsbury’s chief financial officer John Rogers, who chaired the group of executive level members leading the project for the BRC, added: “The current system is outdated and cumbersome and does nothing to encourage retailers to invest. We believe we can do better for business and for tax payers and these options represent tangible progress in the debate on what reform could look like if we think about retail in the future, rather than the past.”
Other ideas put forward in the report include rewarding employment by delivering a discount to the Business Rates bill based on a given value per employee, capped at an overall proportion of company rates bill.
It also suggests providing a discount to the Business Rates bill based on a percentage of Corporation Tax payment, again capped at an overall proportion of company rates bill.
