// Revo calls on government to accelerate its commitment to review the business rates system
// Letter to the new Chancellor sets clear expectations for radical reform
// Revo represents all stakeholders in the £360 billion retail property sector
Revo has written a letter to the government urging it to “act swiftly and radically” in its promise to fundamentally review the business rates system.
Ahead of the upcoming budget on March 11, the retail property organisation called on new Chancellor Rishi Sunak to accelerate an assessment of the current “unfair and outdated” system.
Revo, which represents all stakeholders in the £360 billion retail property sector, added that the current system “deters investment into the UK by global companies”.
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In its letter to the Treasury, Revo outlined the following principles for a reformed business rates system:
1. Create an internationally competitive rate of tax that can be adjusted annually to reflect changing economic conditions
2. Reduce the burden levied on physical business through introducing some form of digital sales tax
3. Fully resource and invest in the business rates and appeals infrastructure, including new technology and extra human resource
4. Remove downwards transitional phasing so that any benefit from a fall in business rates as a consequence of revaluations is applied in full immediately
Revo chief executive Ed Cooke said: “The government must deliver on its commitment to review the business rates system, and act swiftly and radically.
“Inevitably this should include considering a form of digital sales tax to allow for an immediate reduction in business rates, which at more than 50 per cent is one of the least competitive corporate tax rates in the world.
“We call on the new Chancellor to put in place a system that allows for the iniquitous downward transition policy to be abolished, which would signal meaningful support for retail businesses, particularly in areas where the Conservative Party was lent votes in last year’s General Election.”
Revo also stressed the importance of local infrastructure and the role of the Town Centre Fund in delivering vital improvements, and urged the government to explore an extension or expansion to the current Future High Streets Fund and the Towns Fund.
The government has currently pledged £1 billionn under the Future High Streets Fund for towns to reinvent their offering.
Revo said business rates tax has risen from 34 per cent to 50 per cent of rateable values since 1990, making it one of the highest corporate taxes in the world.
Around 24 per cent of business rates revenues are delivered from the retail sector, equating to about £7 billion – even though retail as a whole only contributes five per cent of the UK’s total Gross Value Added annually.
“The overall burden needs to come down for businesses large and small,” Revo stated.
“The system is unfair, outdated and deters investment into the UK by global companies.”