UK trade bodies push for alignment of business rates with April 24 CPI

April’s rise is linked now to the previous September’s consumer price index (CPI), implying retailers, hospitality and leisure venues will be saddled with an inflation-busting 6.7 per cent increase, the British Retail Consortium (BRC) said in a release.

The letter, signed by BRC, the Association of Convenience Stores, the British Beer and Pub Association, the British Independent Retailers Association and UK Hospitality, urges Hunt to instead use the Bank of England’s second quarter forecast for inflation—currently 2 per cent.

“April’s rates rise should be based on April 2024 CPI, rather than the level from seven months prior, when global cost pressures were still keeping inflation high. This would keep our business rates contributions in line with current changing prices, rather than introducing an inflationary rise. It would support our industries as they seek to drive greater investment in villages, towns and cities all over the country,” the letter read.

This constant rise in property taxes has been one factor behind the closure of tens of thousands of shops, restaurants and pubs over the last five years, the BRC release noted.

The United Kingdom has seen the loss of over 26,000 shops, pubs and brewers and hospitality and leisure venues in the last five years.

“April’s rates rise will be more than three times the expected inflation at that time. This means above-inflation cost increases for businesses, which will put significant upwards pressure on prices, jeopardising the current success in bringing down inflation. The Government needs to fix this anomaly and make sure April inflation is the determinant of April’s rates rise,” BRC chief executive Helen Dickinson said.

Ahead of this week’s Budget, the Confederation of British Industry (CBI) has also called on Hunt to use targeted fiscal and regulatory levers to support industries that will power sustainable economic growth in future.

With fierce global competition for jobs and investment in green industries, life sciences, digital technologies, creative industries and advanced manufacturing, it is a platform that requires government support to ensure the United Kingdom stays ahead of its rivals and maximises the country’s growth potential, CBI said in a release.

CBI has urged Hunt to commit to developing a Net Zero Investment Plan that will provide the certainty needed to crowd-in private finance and further extend the plug-in van and truck grant beyond 2025 to support the decarbonisation of commercial vehicles.

It also requested the finance minister to update the United Kingdom’s green finance road map to signal to global markets that Britain’s financial services industry can play a leading role in the transition to net zero.

Other suggestion by the CBI included increasing the total that can be raised from the Enterprise Investment Scheme for Knowledge Intensive Companies from £20 million ($25.26 million) to £30 million ($38.04 million) to support research and development-intensive scale-ups to grow.

Fibre2Fashion News Desk (DS)