Over 70 retail bosses – to include leaders from Oliver Bonas and Dobbies – have written an open letter to the Chancellor of the Exchequer calling for reform of the current business rates system.
The letter – which has been coordinated with the British Retail Consortium – urges Rachel Reeves to ‘level the playing field’ between industries, making a retail adjustment to rates to achieve its manifesto commitment of replacing business rates with a system ‘fairer for bricks and mortar businesses… to better incentivise investment, tackle empty properties and support entrepreneurship’.
The letter asks the Chancellor to use the Autumn Statement on October 30 to apply a Retail Rates Corrector, a 20% reduction to rates for bills for retail properties of all sizes in all locations.
The letter to the Chancellor says: “The retail industry is the UK’s largest private sector employer, supporting three million direct jobs and a further 2.7 million in the UK supply chain, and contributes over £100bn pa to UK GDP.
“The businesses we lead make up the majority of these numbers. We look forward to working with you and the new government and believe that through retail’s scale and reach we can be an important partner in supporting investment and growth across the country.
“Research commissioned by the British Retail Consortium shows conclusively what we have known in our businesses for years: the retail industry pays more than its fair share of tax. We pay 7.4% of all business taxes, a share 1.5 times greater than our share of the overall economy, and retail’s tax bill amounts to 55% of pre-tax profits, the highest proportion, along with hospitality, of all main business sectors. Within this, business rates alone equate to 11% of profits.
“This tax burden is having a detrimental socio-economic impact on local communities through store closures and job losses – in two-thirds of the 6,000 store closures in the UK over the past five years, the rates bill had a material impact on the decision to close. Rates are also holding back current investments we want to make in pay and upskilling our people, in new and improved stores and in the technology, that will support productivity and economic growth.”
Retailers signing the letter include include Aldi, Asda, ASOS, Associated Independent Stores, Barker and Stonehouse, Iceland, Marks & Spencer, Matalan, Morrisons, New Look, Poundland, Sainsbury’s, Tesco, The Works and WH Smith.
Top: Major retailers have written to the Chancellor calling for reform of the current business rate system.
