Major retailers hit out at ‘broken’ business rates system

Fifty two retailers, including Asda, Primark, Sainsbury’s, Debenhams and Poundland, have called on the government to take the first steps towards fundamental business rates reform in the upcoming budget.

A letter, coordinated by the British Retail Consortium, focuses on fixing transitional relief. It argues that the “burden of business rates has become unsustainable for many retailers” and that the system is broken, a view echoed by the Treasury Select Committee in October 2019.

Scrapping downwards phasing would remove the harmful effects transitional relief has on retailers and businesses in the north of England, it states. This could be achieved by central funding of upwards transitional relief.

Eric Mazillier, UK CEO at Decathlon, says: “The business rates system is broken and in urgent need of fundamental reform. It undermines investment in shops, damaging job creation and hurting high streets and town centres. Fixing the complex transitional relief scheme would be a good start.”

Nick Lakin, Group Corporate Affairs Director at Kingfisher, comments: “Business rates are the number one tax paid by UK retailers. The tax rate is unsustainable, the system too complex and it does not reflect modern retail. Downwards transitional relief has added to this complexity and is exacerbating regional imbalances.”