BRC urges government to keep business rate rise to less than 5%
The British Retail Consortium says the benefits gained from government proposals to allow local authorities to retain some locally raised business rates risks may be negated by the increase in business rates next year.
In its response to the Local Government Resource Review, the BRC said it supported the principle of incentivising councils to encourage business growth by allowing them to keep a percentage of tax income. However, its concerned that the proposed reforms will not benefit either retailers or councils as much as they should if business rates rise by more than 5% next April. The organisation is worried that the rate is usually increased each year by September’s RPI, which was 5.6% last month.
BRC director of business, Tom Ironside, said: “The principles behind the proposed reforms to business rates are sound, providing a uniform central rate is maintained to provide much needed business certainty. Businesses benefit from council investment in their local infrastructure and the local authorities deserve to benefit in turn where there is genuine growth.
“But this scheme’s potential to drive business growth and boost council coffers could be reduced because of the likelihood of a colossal 5.6% rise in business rates next April. Coming on top of a 4.6% rise this year, such an uplift would make it even harder for retailers to thrive at a time of low consumer confidence and poor spending.
“The review of local government resources looks at proactive ways of supporting and promoting business growth for the benefit of local communities. We ask that the Government supports businesses and local authorities in the same way by imposing a lower increase in business rates for the coming year.”
