Sainsbury’s and Morrisons commit to repaying business rates relief

Sainsbury’s and Morrisons commit to repaying business rates relief
Sainsbury's CEO: "While we have incurred significant costs in keeping colleagues and customers safe, food and other essential retailers have benefited from being able to open throughout."
// Morrisons announces on Wednesday evening it will repay £274m business rates relief
// Sainsbury’s joins Big Four rivals on Thursday morning announcing it would forgo £450m relief
// Announcements likely to put pressure on other retailers who were able to continue trading through lockdown to return relief

Sainsbury’s and Morrisons will join Tesco in repaying the business rates relief they received this year as a result of coronavirus.

Yesterday morning Tesco announced it would repay £585 million of relief it received from the Government that was offered to all retailers to help them survive lockdown.

Big Four rival Morrisons responded in kind on Wednesday evening, stating that it had pledged to hand back the £274 million it had received.


READ MORE: Tesco to pay government £585m it saved from business rates holiday


On Thursday morning, Sainsbury’s announced it would also forgo around £450 million of business rates relief granted by the Government.

The paybacks will return over £1.3 billion to the government, and is likely to increase pressure on Asda, who have not yet indicated if they will pay back their rates relief.

The one-year business rates relief was first announced by Chancellor Rishi Sunak earlier this year and applies to all retail, leisure and hospitality firms until March 2021.

Early in the pandemic Tesco and rival supermarkets faced criticism for taking the rates relief at the same time as handing out dividends to shareholders.

Data from Altus Group showed that Sainsbury’s is expected to save £498 million from its rates holiday for the year – although Sainsbury’s said it was closer to £450 million.

Last month, Sainsbury’s said it had received a break worth £230 million for the half-year to September in an update which also saw it reveal plans to axe 3500 jobs.

However, the grocery giant has faced criticism as it also declared an interim dividend of 3.2p plus a special dividend of 7.3p for shareholders.

“While we have incurred significant costs in keeping colleagues and customers safe, food and other essential retailers have benefited from being able to open throughout,” Sainsbury’s chief executive Simon Roberts said.

“With regional restrictions likely to remain in place for some time, we believe it is now fair and right to forgo the business rates relief that we have been given on all Sainsbury’s stores. We are very mindful that non-essential retailers and many other businesses have been forced to close again in the second lockdown and we hope that this goes some way towards helping them,” Roberts added.

Asda has not yet responded to a request for comment by Retail Gazette at the time of publication.

Click here to sign up to Retail Gazette’s free daily email newsletter

1 COMMENT

  1. So now perhaps others like Screwfix, Halfords, Boots and all other pharmacies, The Range, B&M and DIY chains should all follow suit and repay their rate relief. Nobody should be trading through the lockdown and achieving at or above last year’s sales and keep the rate relief.

LEAVE A REPLY

Please enter your comment!
Please enter your name here