Written by: Keith Tully
Reviewed: Tuesday 4th June, 2019
The issue of business rates and the extent to which they’ve increased in recent years is now the foremost challenge facing high street retailers.
That’s according to the findings of a new piece of research which canvassed the opinions of decision-makers at 50 retail companies, many of which have hundreds of outlets across the UK.
Royds Withy King, the law firm, carried out the research and established that 61 per cent of respondents considered rising business rates to be the single sternest challenge facing high street operators nationwide.
Other issues cited as key concerns included reduced footfall, which was cited by 19 per cent of respondents as a major problem, and the pressure to discount, which was viewed by 11 per cent of those polled as a serious financial headache.
According to the same survey, as many as 41 per cent of retail sector respondents would like to see some form of ‘internet tax’ created to help give high street retailers more of a chance to compete effectively against their online rivals, who generally pay much less in business rates.
“Business rates continue to batter the high street and it is clear that reform of our outdated business rates regime can’t come soon enough,” said Bharat Nahar, a partner and head of retail at Royds Withy King.
“Retailers are working hard to improve the customer experience, however the government need to do their bit to help the high street – including looking at less obvious answers.”
Speaking recently at a conference event, the president of the Confederation of British Industry (CBI) John Allan said that the current business rates regime in the UK hurts companies across the country and the wider economy.
In fact, he referred to the tax system currently in place around business rates as being “uneconomical, unsustainable and, frankly, unintelligible”.
Mr Allan suggested that problems with business rates have been a significant factor contributing to the collapse of well-known high street retailers in recent years, including the likes of Debenhams, House of Fraser and Maplin.
“I’ve yet to read an explanation that doesn’t cite business rates as at least part of the cause,” he said, in reference to Debenhams’ recent entry into administration.
9th December 2019
Small and medium-sized enterprises (SMEs) are waiting almost twice as long for the payment of their overdue invoices in 2019 than they did last year.Read More