Ed Miliband caught in business rates row helping big corporates
Tony Benn would be turning in his grave if he saw the latest headlines about Ed Miliband's plans to help small businesses inadvertently offering tax breaks for big corporates.
But that's how the media is portraying the news after Labour said this week it would cut business rates for properties with a rateable value of below £50,000.
It sounds great for small businesses however, according to research, this would also cut rates' bills of more than 100 Boots shops as well as more than 5,000 banks, including HSBC. This flies in the face of the Labour leader's pledge not to offer tax breaks for major corporates.
Labour's reports states there would be no further cuts for large businesses but will instead "cut and then freeze business rates for small and medium-sized firms… a cut in business rates will mean an average saving of over £400 on 1.5 million properties".
What Ed failed to take note of was the fact that a number of large companies occupy buildings with a rateable values which would fall into this threshold. If ratepayers have to officially register as a small business to make the distinction then we are looking at a new level of red tape all round.
What we don't need at the moment is more bureaucracy, what we need is to take business rates back to basics and take the smallest properties out of the system altogether. This would cut costs, appeals and reduce collection costs for billing authorities. Roll on the revaluation in 2017 as this will help to correct the market which has been artificially skewed against small businesses particularly outside the South East and London which have enjoyed comparatively lower business rates as rents have continued to rise.
A Tory MP is calling for business rates to be scrapped and replaced by an increase in VAT in order to save high street businesses.
Maximising income and protecting cash flow has never been more important for landlords as the UK battles through the latest stage of the pandemic.
Here is an easy way to check if your business is eligible for further grants to help you through lockdown 3.0.