ACS has responded to the Chancellor's Spring Budget,
welcoming a £300m discretionary rate relief
scheme, but raising concerns over a minimum excise tax
on tobacco, the costs for small businesses of introducing new tax
reporting processes, and new tax rules for dividends paid to
owner-directors.
ACS chief executive James Lowman said: "The £300m
discretionary fund given to Local Authorities could provide
welcome relief to the hardest hit by business rates increases. We
are committed to working with the Department for Communities and
Local Government on the formula for allocating discretionary
relief funding across local authorities, and we will help members
make their case for rate relief to their local authority. We are
disappointed that there has been no targeted relief for petrol
forecourts which are some of the hardest hit businesses as a
result of the revaluation, but will support these stores in
making a case to their local authorities for much needed
help.”
The Chancellor also announced future plans to
review the way that different business types have their rates
bills calculated, but did not commit to a timescale
beyond 'before the next revaluation'.
Mr Lowman continued: “We along with our business groups
have repeatedly called for a proper fundamental review of the
rates system to ensure that everyone pays their fair share.
Businesses like rural petrol stations and convenience stores with
cash machines providing an essential service to their communities
should not be paying over the odds while internet distribution
warehouses enjoy a decrease in their rates bills. We are
disappointed that the government is not addressing these issues
now, meaning the current inequities in the system will
remain.”
In the Budget, the Chancellor confirmed plans to introduce
a minimum excise tax from 20th May, at
the same time as the introduction of Tobacco Products Directive
introducing a minimum pack size of 20 cigarettes, and
standardised packaging of tobacco.
ACS chief executive James Lowman said: "The introduction of
a minimum excise tax is likely to increase the lowest price at
which consumers can legally purchase a pack of cigarettes. This
will drive more customers to the black market, which already
costs the exchequer in excess of £2bn a year. More needs to be
done on the ground to tackle the illicit trade and help
responsible retailers."
On duty rates, ACS chief
executive James Lowman said: "We will work with the Treasury
on introducing a new duty band for still cider just below
7.5% abv.”
On the Government's Making Tax Digital
plans, ACS chief executive James Lowman said: “The
threshold for businesses to qualify for an additional year before
they have to report their accounts quarterly has been set far too
low at £83,000 turonver, and is irrelevant to convenience
stores. We submitted evidence to Government and in
parliamentary committees, calling for retailers to be given more
time to adapt their software and in-store procedures to comply
with the regulations, and sadly only the very smallest businesses
will be given this additional time. Further support is needed
from the government to support the smallest retailers to
comply with the regulations.”
On the reduction in the tax allowance for
dividend payments to owner-directors of small
businesses incorporated as limited companies, from £5,000 to
£2,000,Mr Lowman said: “Having been encouraged to become limited
companies, the rules are again being changed so that these small
business owners have to pay more tax on their often small
profits. Convenience store owners work among the longest
hours of any group in the country, and the further tax burden on
these businesses is unfair.”
