Announcements are expected in the Chancellor George Osborne’s 2015 Autumn Statement (due to be delivered on Wednesday November 25) about the future direction of business rates.
Michael Weedon, deputy ceo of bira (British Independent Retailers Association),comments: “If the Chancellor does not get them right, retail in general and small shops in particular will be headed for trouble.In the short term, the business rate discount of £1,500 for retail and leisure businesses and rate relief for small businesses are temporary measures, which need to be renewed annually.
“If George Osborne does not announce their renewal for 2016-17, then a small high street shop with a rateable value of £6,000 could see its rates bill go from zero to nearly £3,000 – and all shops with a rateable value up to £50,000 could find themselves facing an extra cost of £1,500.
“This comes at a time when research from bira and the Local Data Company (LDC) shows that the number of small shops has fallen in the past year, after four years of growth that has helped bring down the shop vacancy rate. That vacancy rate, though, still remains at more than double the rate pre-crash.
“In the equally important longer term, the future for the way business rates are levied – the subject of the ‘fundamental review’ of rates that has been in progress this year – is likely to be revealed and this will have a major impact on small shops for decades.
“The October announcement of what will happen to the money once local authorities have collected it will need to be elaborated as well. Statements about the end of the Uniform Business Rate are premature, as it is obvious that there will still be a national multiplier in place, just as there will still be a system to redistribute income among local authorities.”
Alan Hawkins, ceo of bira, added: “This is crunch time. The Chancellor holds the fate of the High Street in his hands. He promised fundamental rates reform and has made it clear that he recognises the special problems faced by retailers. On Wednesday, we will find out if he is really going to help save the High Street – or instead just ratchet up the pain.”