- Danielle Wightman-Stone |
Two leading property industry trade bodies, the British Property Federation (BPF) and British Council of Shopping Centres (BCSC) are following in the footsteps of the Confederation of British Industry and urging the government to significantly overhaul the current business rates system.
In a joint statement, the two organisations state how “out-of-kilter” the tax is with rental values, which it says has only grown by 5 percent since 2000 and remains lower than their 2007 high, and that if changes aren’t made to the business rates that businesses will soon face 60 percent rate of tax by 2022.
The industry trade bodies cite research by a number of surveyors, which suggests that the business rates multiplier is effectively a 49.3 percent tax, potentially rising to 60 percent within the next seven years.
Melanie Leech, chief executive of the British Property Federation, said: “From the advent of the internet to the financial crash, the way we use property has seen enormous changes since business rates were introduced in the early nineties.
“In order to ensure that the business rates system is fair, government must ensure that the rates system takes account of these changes. Failure to do so could mean the UK missing out on investment, with longer term risks for the competitiveness of our economy.”
Edward Cooke, director of policy and public affairs, BCSC, added: “The current business rates system is an unsustainable way of raising tax to contribute towards running local public services. This has been reiterated time and time again, and Ministers' statements and this review are an acknowledgement of this.
“Now government has a chance to show business that it believes in great British retailers and vibrant places as a key part of a multichannel retail future. The market in which these businesses operate is changing faster than ever and a tax system that reflects these fluctuations is critical.”