Call to back business rates reform
An influential business lobby group will today call on the major parties to back a radical reform of business rates in the run up to the next general election.
The British Retail Consortium (BRC), which represents thousands of small firms, believes the rates should be cut, while the tax should also be related to economic performance and include green energy incentives.
The BRC wants the major party leaders to back these changes in the run up to the 2015 election, with a complete overhaul of the current system within two years.
Business rates are currently based on 2008 property valuations set before the full onslaught of the financial crisis and when the cost of renting a shop or an office was often higher than now.
BRC director general Helen Dickinson, said: "The challenge for politicians is to show us all how they are going to embrace the task of reform and deliver, with us, a system that is fit for the 21st century."
Nick de Bois, Conservative MP for Enfield North and member of the All Party Retail Group, added: "The present business rates system is archaic and flawed. Often business rates exceed rents and are not linked to business performance."
The last major change to business rates came after the 2013 Autumn Statement when Chancellor George Osborne announced a £1 billion plan to offer small retailers a £1,000 discount on their business rates and a cap of 2% on future rate increases. This move affected 1.8 million rate paying firms.
The Government said it was considering a more fundamental reform of business rates in a review set for 2017.
High streets minister Brandon Lewis said this review would "balance the need for the system to deliver simplicity, fairness, stability and predictability to ratepayers".
Shadow chancellor Ed Balls, in a speech at the London Business School yesterday, said a Labour government would "cut and then freeze business rates for more than 1.5 million business properties".
He added "When resources are tight this is a tough choice to allow us to support more businesses and keep our overall business tax regime competitive."