As the British Chambers of Commerce (BCC) publishes statistics
that show two-in-five businesses are more concerned about
business rates than three months ago, the business group renews
its call for action in the Spring Budget this week to ease the
burden of rates and bring about fundamental reform to the system.
New interim statistics from the BCC’s Quarterly Economic Survey,
based on the responses of over 900 companies, show that 39% of
businesses are more concerned about business rates than three
months ago, second only to those reporting higher concern around
exchange rates (42%) than three months ago.
The results show that it is small businesses who are most worried
about the burden of business rates, with one-in-two (50%) saying
it’s of greater concern, the highest of any factor.
The business group is calling for the Chancellor to use his
Spring Budget to support long-term investment and growth by
taking action on this upfront costs which hits businesses
unfairly, and irrespective of their economic health or
circumstances.
BCC seeks four key measures on business rates from the Spring
Budget:
-
· Abandon
the fiscal neutrality principle in business rates
reform – an unacceptable barrier to fundamental
reform of the business rates system that is unique to that tax.
This would allow the government to help those firms most affected
by the revaluation.
-
· Drop
proposals that would restrict the ability of the Valuation
Tribunal for England to order changes to business rates
liabilities – ensuring businesses access to justice
and fairness.
-
· Bring
forward the switch from RPI to CPI, currently planned for April
2020, to April 2017 – limiting annual increases
starting more swiftly.
-
· Longer
term, remove all plant and machinery from the valuation of
property for business rates purposes.
Dr Adam Marshall, Director General of the British
Chambers of Commerce, said:
“Rising business concerns demonstrate the urgent need for action
on business rates in the Budget this week. The UK had the
highest business property taxes in the developed world
even before the recent revaluation - hammering firms with
sky-high costs before they turn over a single pound. This
undermines business investment, which in 2016, fell for the
first time in seven years.
“As the new bills kick in from April 1st, many will see this
situation get worse with some facing double, even triple-digit
growth in the amount they must pay. Businesses face a
tipping point: with rates rising for many and the
combined costs of currency depreciation, the new National
Living Wage, Pensions auto-enrolment and rising energy prices -
urgent action is needed to reduce the upfront costs of doing
business.
“In the short-term, the Government must provide additional relief
to the firms hit hardest by rates and re-visit the detail of
reform to the appeals system. It should bring forward the change
from RPI to CPI this year.
“In the longer-term, fundamental change is needed, including
stripping plant and machinery from rates assessments that does so
much to discourage business investment.”
Ends
Notes to editors:
The interim data from this survey are drawn from responses from
over 900 business people across England. Firms were questioned
online between 20th February and
3rd March 2017. Please note that the fieldwork
for this survey is still ongoing. Small businesses are defined as
those with between 10 and 49 employees.
