Autumn Statement spells wind of change for business rates

Key MPs have backed George Osborne’s plans to go back to the drawing board on the British business rates system.

Rates ruling: Did George listen?

Following heavy campaigning from retailers, industry bodies and Retail Express, George Osborne announced the following measures in his autumn statement:

• a full review into the future structure of business rates to be completed by 2016;
• the introduction of a Retail Business Rate Discount, giving retail businesses a saving of up to £1,500;
• an extension of the annual cap of 2% on the business rates multiplier; and
• extension of the doubling of Small Business Rate Relief.

Speaking at the All-Party Parliamentary Small Shops Group meeting last week, David Gauke MP, Financial Secretary to the Treasury, said concern about business rates had moved up the political agenda.

“There is a desire to preserve the high street and this is a great opportunity to shape where we go,” he said. “I aim to do a lot of hard thinking to develop a system that is more sustainable.”

He added that 300,000 shops would benefit from the Retail Business Rate Discount and welcomed the contribution of small shops to the review. “I urge all of you to engage, because we’re keen to listen,” he said.

Osborne announced Government would review business rates in the Autumn Statement on December 3 (see box right for details).

The meeting was chaired by Simon Danczuk MP and attended by a raft of MPs across the political spectrum, as well as trade organisations, including the ACS, British Independent Retailers Association and the Rural Shops Alliance.

Representatives for small shops welcomed the measures announced by Osborne and took the opportunity to put their concerns to Gauke.

“The 2% cap on rates increases has been well received by our members,” said ACS chief executive, James Lowman. “But in the longer term, we need to find a fairer and more transparent system for calculating business rates.”

Andrew Chevis, RSA director, added: “The current system isn’t working. We’ve got to look at the future and not the past.”

Click here to see what experts, industry bodies and retailers thought of this year’s Autumn Statement