Consumer Price Index (CPI) inflation jumped to 5.2% in September from 4.5% in August, while the Retail Price Index (RPI) measure of inflation has risen to its highest level in 20 years, at 5.6%.
RPI increased from 5.2% in August to 5.6% in September. Uniform business rates (UBR) for the year ahead are based on September’s rate of inflation, sparking fears of a spike in the tax, at a time when retailers are already having to deal with other rising costs.
Retail property body British Council of Shopping Centres has written a letter to the Department for Communities and Local Government, urging it to give struggling retailers a “fair deal” by setting the UBR at a lower rate than RPI.
BCSC executive director Edward Cooke said: “Business rates are a £6m a year cost to the retail sector, and at a time of falling consumer disposable income, low levels of bank lending and weak consumer confidence increasing business rates is unsustainable.”
“The retail industry employs more than 1 in 10 of the total UK workforce but whilst Government has committed to saving council tax payers money the urgency to do so for business occupiers and investors is not apparent.
“This is short-sighted because it inhibits retailers’ ability to employ more people and invest in the fabric of our towns and cities.
“We strongly believe a profitable retail sector is a vital engine of future economic growth, and that Government should use the powers that it already has at its disposal to freeze next year’s rates increase.”
CPI annual inflation has never been higher at 5.2%, although it reached this level in September 2008.
Women’s outerwear created the largest downward effect on CPI, with children’s outerwear contributing too, although to a lesser extent. Clothing and footwear prices overall rose by 4.4% this year between August and September.
The largest upwards effect came from housing and household services, driven by gas and electricity.