Retailers “encouraged” by Spending Review despite no further business rates relief

Retailers
The Spending Review also included adopting a moderate increase in the New Living Wage, and a Levelling Up Fund to support local high streets in the wake of the pandemic.
// BRC “encouraged” by Chancellor’s Spending Review
// Gov’t is considering options for further business rates relief for retailers affected by Covid-19, although no further details provided
// No reversing decision to end tax-free shopping for international visitors to the UK, either

Retail leaders have said they are “encouraged” by the UK Government’s Spending Review, which revealed it was considering options for further business rates relief for retailers affected by Covid-19.

The government has said it will freeze the business rates multiplier – which typically increases rates bills by inflation – from next April for the financial year.

However, no further details were provided around this issue, including a possible extension of the business rates holiday that was implemented for the current financial year.


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BRC chief executive Helen Dickinson the government should adopt its proposal business rates relief at 50 per cent to reflect the fall in retail property values and reality of the market, while also generating revenue for the Treasury.

“We are encouraged that the government is considering options for further rates relief for businesses affected by Covid,” she said.

“Many retail businesses have been shuttered for the past month, depriving them of £8 billion in sales.

“A return to full business rates liability in April would be impossible for some firms to meet and freezing the multiplier in 2021/22 does not solve this problem.

“The government should adopt our proposal for business rates relief at 50 per cent which reflects the fall in retail property values and brings market reality into the system, while generating much needed revenue for the Treasury.

“This, along with an extension to the moratorium on debt enforcement, to encourage constructive dialogue between landlords and tenants on rents, will support the resilience of the retail industry.”

Chris Turner, chief executive of major business organisation British BIDs said: “Many businesses are telling us that they need the business rates holiday extended as they turn things around after the pandemic.

“Shame we didn’t get that today, we hope the Chancellor will re-consider this as it will help save many more jobs and livelihoods as the economy makes its comeback.”

Dickinson was also “disappointed” the Chancellor did not choose to reverse the decision to end tax-free shopping for international visitors to the UK.

“The policy will deliver a relatively small saving for the Treasury at the expense of a far greater return to the UK economy, and will damage the UK’s position as a top destination for international shoppers,” she said.

Other aspects of the Spending Review included adopting the Low Pay Commission’s recommendations for a moderate increase in the New Living Wage, as well as a £4 billion Levelling Up Fund to support local town centres and high streets in the wake of the pandemic.

“We celebrate the new local infrastructure pot for projects like our railways, zero-emission buses and broadband,” Turner said.

“This money will really help our towns and cities recover, and Business Improvement Districts will be well placed to make sure it is spent on the right things.”

Dickinson said: “We heard with interest what the Chancellor had to say about a ‘Levelling Up Fund’ to support local areas.

“We hope the fund can be used to provide much needed investment in town and city centres, supporting local communities and businesses around the country.”

Meanwhile, CBI chief economist Rain Newton-Smith said stark forecasts pointed to “tough times ahead”.

“The Chancellor has made some bold autumn decisions to power a spring recovery,” he said.

“The Spending Review lays the foundations for a brighter economic future. A new National Infrastructure Bank, long-term funding for innovation, and a comprehensive plan for creating jobs and renewing skills are just some of the building blocks needed to deliver on this vision.

“Ambition must be matched by action on the ground. The Government’s commitment to build, build, build must be delivered now, and there can be no let-up in the support for firms facing new Covid restrictions.”

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