Britain’s outdated business rates system must be ripped apart and rebuilt to ensure the High Street can survive and thrive after the pandemic, a major lobby group has claimed.
The Confederation of British Industry (CBI) is urging Rishi Sunak to reveal a ‘comprehensive reform’ of business rates in his Budget at the beginning of March.
And to ensure that as many businesses as possible can get through the next few months, the Chancellor must act ahead of the Budget to extend coronavirus support measures beyond the end of March, the CBI added.
Tax reform: The Confederation of British Industry is urging Chancellor Rishi Sunak to reveal a ‘comprehensive reform’ of business rates in his Budget at the beginning of March
If Sunak waits until the Budget to unveil extensions to the furlough scheme and emergency loan schemes, many businesses will already have had to make tough decisions to axe jobs and shutter premises.
CBI director-general Tony Danker told the Chancellor: ‘Businesses recognise the vital importance of national lockdowns in combating the Covid-19 health emergency, but the economic reality facing firms now is extremely challenging. After almost a year battling the pandemic, business resilience is at an all-time low.’
But Sunak is hoping to start getting a grip on the UK’s creaking public finances in his Budget on March 3, and the CBI estimates its proposals will cost £17.9billion.
Retailers and restaurants, however, were already struggling with sky-high business rates before the pandemic hit, and the Mail has been campaigning for a fairer system which would not unfairly penalise bricks-and-mortar stores over their online competitors through the Save Our High Streets campaign.
The Government introduced a business rates holiday last year but this will end in April.
Rain Newton-Smith, the CBI’s chief economist, said: ‘This Budget is an opportunity to focus on a balanced economic recovery, not driven solely by consumption and government spending, by stimulating much-needed business investment and tackling the systemic challenges that have held the UK back.
‘Top of that list must be a fundamental review of our outdated business rates system.’
Danker urged the Chancellor not to think about raising taxes just yet. He said: ‘It would be wrong to raise business taxes when we don’t yet have a recovery. It’s that simple.’
A Treasury spokesman said: ‘As the Chancellor has set out, the Budget will be the moment to take decisions in the round and outline the next stages of our Plan for Jobs to support businesses and families.’