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Chancellor to cap business rates rises at 2%

Chancellor George Osborne will cap business rate rises at 2% in England and Wales in 2014, according to reports.

In the Autumn Statement to be released tomorrow (December 5), Osborne is expected to reveal that rate rises will be limited to 2% next year instead of being linked to September retail prices index measure of inflation, which is set at 3.2%.

The cap will provide welcome relief to retailers who have blamed the high cost of business rates for restricting investment and new job creation.

Osborne will also extend a scheme that offers rate relief to small businesses, but will stop short at carrying out an entire review of the business rates system, according to the BBC.

It is understood the move to cap the rates at 2% will mean more than £300m of revenue is lost next year.

In Scotland, local councils will be able to adjust their own business rates relief packages to reflect the needs of local businesses, as outlined by the Scottish government earlier this year.

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