London, UK: The UK Warehousing Association (UKWA), the Confederation of British Industry (CBI), and major supermarkets are all calling for reform to the business rates system in the run-up to the budget.
The UK Warehousing Association chief executive Clare Bottle has written to the chancellor ahead of the budget, asking for support for the warehousing sector. UKWA has highlighted the thorny issue of business rates, arguing that the government needs to address the “unfair and punitive basis for assessing business rates, which has put warehousing at a significant disadvantage”.
The CBI argues that the Labour government should bolster business certainty with a business tax roadmap, alongside long-term business rates reform.
CBI chief executive Rain Newton-Smith said: “A Business Tax Roadmap will provide a long-term framework to tax policy, lending businesses the certainty and clarity to invest and plan effectively. The roadmap should cover the main taxes administered by businesses to deliver a simpler, more digitised and proportionate tax system.
“This should sit alongside reform of the business rates system, with bold action to move to a progressive slice-based system, removing cliff edges and disincentives to invest. In the meantime, the CBI is urging a freeze on both the standard and small business multipliers until the next revaluation and bridging support for sectors most affected by the termination of temporary reliefs.”
Meanwhile, over 70 leading retail heads have written to the Chancellor, calling on the new government to introduce a Retail Rates Corrector as part of Labour’s commitment to reforming the business rates system. Signatories to the letter, co-ordinated by the British Retail Consortium, include the chief executives of Iceland, the Co-op, Asda, Lidl, Morrisons and Sainsbury’s.
The Retail Rates Corrector – a 20% downward adjustment in business rates paid on retail properties – aims to redress the imbalance that sees the retail industry pay 7.4% of all business taxes (£33bn), a share 1.5 times greater than its share of the overall economy (5% GDP). This tax burden holds back investment in people and places – directly affecting the 3m people employed by the industry, and the 2.7m additional people employed within the supply chain.
The retail bosses claim that retail and hospitality pay the highest proportions of their pre-tax profits in taxes compared to any of the other main business sectors.
The letter states: “We believe now is the time to level the playing field between industries with a retail adjustment to rates as this is the best way to achieve this manifesto commitment. We are writing to ask you to use the Autumn Budget to apply a Retail Rates Corrector and a 20% reduction to rates bills for retail properties of all sizes and locations.”
The new government’s first budget is scheduled for Wednesday 30 October 2024.
