Independent fashion retailers across England have called on the government to freeze business rates, as they brace for another predicted rise in April.
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More than 37,360 small shops in England will face steep increases above the rate of inflation at the start of the next financial year, research by business rates advisory service CVS indicates. Around 30,000 of these face a rise of between 10% and 15%.
It comes after some independents experienced rises of nearly 90% following April’s business rates revaluation in England and Wales.
Mark Rigby, chief executive of CVS, urged chancellor Philip Hammond to be “bold” in his Budget on 22 November, and pledge to freeze rates for next year. He pointed out that small businesses are already struggling with rising costs and weaker consumer confidence.
“Brexit is driving inflation,” said Rigby. “With prices rising faster than wages, households are tightening their belts. [Meanwhile], business investment has slowed and confidence fallen. Against this backdrop we already have the highest property taxes not only in Europe, but the world.”
Independent retailers Drapers spoke to this week agreed that a freeze would help.
“I’m concerned about the ever-spiralling increase in overheads,” said Matt Horstead, owner of Dartagnan Menswear in Chichester. “If it’s not astronomical rents, it’s business rates, minimum wage, staffing … The list goes on and on. It isn’t sustainable. If we’re not careful, in the next five years there won’t be any independents.
“Chichester is renowned for small indies, and even now they’re being whittled away. Let’s not have a rates rise again.”
Some independents have called for small business rates relief to be extended.
Chris Hayes, owner of Woven Gentlemen’s Outfitters in Durham, said: “We’ve tried to get our business rates reduced in the past and we haven’t been successful. We always speak to the council to see if there’s anything we can do about it. Without a doubt, I’d like the government to freeze rates.
“We’ve asked CVS if there’s anything we can do. We’re concerned: business rates are already extremely high for independents.”
An owner of a designer independent in the north-west of England agreed that “any discount helps”: “For the past year I’ve received discounts on my rates as my council has been looking to help small businesses.”
A Treasury spokeswoman said: ”We are delivering the biggest ever cut in business rates to businesses across the country. The almost-£9bn package will see a third of all businesses pay no rates at all, and will mean nearly 1 million companies will see their bills cut.
“In March, we announced an additional £435m package to support businesses in England facing the steepest increases following the revaluation. This includes limiting the increase in bills of 16,000 small businesses to £50 a month this year.”
Small businesses are defined by the government as those with properties that have a rateable value (the market rent as at 1 April 2015) of less than £20,000, or £28,000 in London.
The British Retail Consortium this week also called for action in the upcoming Budget to support consumer spending and encourage private sector investment. It proposed measures including freezing the business rates multiplier in April 2018, which it argued would otherwise increase the bill of every rate payer in the country and divert £270m of retail investment.
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