The Treasury has branded growing fears over business rates the result of “scaremongering”, as pressure mounts to alter the reforms.
Treasury chief secretary David Guake has spoken out about the reforms, reassuring that three quarters of businesses will see no increase in rates, or even a decline.
Many groups, including the New West End Company, have branded the new rates as “disastrous”, stating that they will throw some of the country‘s highest-grossing stores into financial turmoil.
This latest defence suggests that calls for Chancellor Philip Hammond to scrap the reforms have fallen on deaf ears, and that they will go ahead as planned.
Yesterday business leaders from the Institute of Directors urged the Chancellor to balance tax rates for small retail businesses and large warehouses where online companies store their goods, citing an system unrepresentative of the modern economy.
“Far from the picture painted by scaremongering ratings agents, nearly three quarters of businesses will actually see no change, or even a fall, in their business rates bills,” Gauke said.
“The fact is that the generous reliefs we are introducing mean that 600,000 small businesses are paying no business rates at all – something we‘re making permanent so they never pay these bills again.
“Whether on a town‘s high street or in a rural community, we‘ve also introduced £3.6bn in support for companies affected by the business rates revaluation – a process that is making the system accurate and fair for everyone.”
London is expected to be worst hit by the reforms, which are based on the value of the property.
As London property prices continue to grow, the taxes will become a considerable strain on retailers in the city.