Business rates risen by 32% in past decade
A few interesting stats are doing the rounds at the moment after a hard start to 2019 for some retailers.
A disappointing Christmas helped to push some retailers over the edge and we are just weeks away from the next rent quarter day where we could see some more casualties.
Overall, since Christmas Day, it has been calculated that 18,722 people working for high street chains have either been made redundant or have had their jobs threatened. Broken down, 14,377 jobs have already gone and a further 4,345 remain at risk. One caveat to those figures is that they could include seasonal positions that were due to finish after Christmas anyway.
Nevertheless, a long list of well-known names have gone to the wall – Oddbins, Patisserie Valerie, Greenwoods – have all entered administration. Other big names to get their bad news on job losses out early this year include Tesco, M&S and Santander.
After the quarterly rent bills arrive on March 25, we will then see a new tax year in April and the annual rise in business rates.
The standard business rate, which applies to all medium and large premises in England with a rateable value over £51,000, will rise by 2.3% in England and will add an extra £127.88m to the rates’ burden for the retail sector alone.
With inflation-linked annual rises coupled with the botched postponement and then revaluation of business rates, it is perhaps not surprising that over the past decade, revenue from business rates has risen in England by 32%. This figure illustrates what a huge tax windfall this is for the Government and, as the bills continue to rise, it’s only going to get harder to find reforms that can deliver that magical “tax neutral” formula that Philip Hammond is insisting on.
This case centres on a substantial three-storey office block: Mexford House, North Shore in Blackpool.
Pressure is still increasing on the Government to take action on business rates after the latest national town centre vacancy rate reached 10.2% last month.
The Rating Surveyors Association has published its response to the Government’s current inquiry on how business rates policy has impacted business with some interesting recommendations.