Retailers are warning of significant challenges ahead for the
industry in Wales if the Senedd proceeds with plans to levy a
business rates surtax on medium-sized and larger stores.
The proposals, which would see larger stores face an additional
business rate surcharge, have sparked serious concern among
retailers who fear the changes could place Welsh businesses at a
competitive disadvantage. It comes as the Welsh Parliament is
being asked today consider the regulations which would
bring into effect the surtax on shops from April 2026.
The Welsh Government's own estimates suggest that at least 970
shops across Wales could face a substantial increase in their
rates bills under the new system — a blow that would come on top
of mounting cost pressures from government-mandated hikes to the
cost of employing people, new packaging requirements, rising
energy prices, and tightening consumer spending. While praising
plans to trim rates for small stores, retailers argue that the
cumulative effect of broader pressures coupled with the surtax
threatens the sustainability of high street stores and shopping
centres, undermining both local employment and community vitality
at a time when town centres are already under strain.
Sara Jones, Head of the Welsh Retail Consortium,
said:
“Welsh Ministers have made headway on aspects of the business
rates agenda in recent years, notably introducing more regular
revaluations. However, the Welsh business rate is the highest in
GB and has risen to a 26-year high, at a time when retailers are
facing challenging trading conditions whilst being thwacked by a
range of other statutory costs.
“The plan to reduce rates for the smallest shops is encouraging,
but a high proportion of retailers operate from medium-sized and
larger premises and are threatened with a new business rate
surtax. These medium sized and larger stores help underpin the
health and vitality of our town and city centres and high streets
across Wales and account for a large share of retail jobs, and
the surtax could see them pay even more than their counterparts
occupying equivalent stores in England. It is imperative MSs act
and ensure no shop pays a surtax and ideally that a commensurate
rates reduction applies to medium-sized and larger stores too.
It's not in the interests of the Welsh economy for retailers to
be incentivised to invest in Cheltenham over Cardiff.”
