Javid signals rates help for smaller traders
Outrage by Tory MPs and a united front from business leaders prompts Budget rethink over local tax rise
SAJID JAVID has said his shopkeeper father would have lobbied him about business rate rises, as he vowed to help small businesses that are hardest hit.
The Local Government Secretary confirmed that Philip Hammond, the Chancellor, will use next month’s Budget to “provide further support” to businesses facing steep increases.
He also vowed to “level the playing field” amid concerns that online retailers’ business rates will fall even as they rise on the high street.
He spoke out just days after prompting a backlash from Tory MPs by blaming criticism of rate changes on a “relentless campaign of distortion and half-truths”.
Now Mr Hammond is expected to use his Budget on March 8 to pay hun- dreds of millions in compensation to small businesses after an alliance of retailers and business leaders warned that Britain’s rates were the highest in Europe and could be a “barrier to investment” after Brexit.
The British Chambers of Commerce, Confederation of British Industry, the British Retail Consortium and Federation of Small Business are among 11 trade bodies that have signed a letter sent to every MP in which they say the business rates system is “unfair, outdated and deters investment”.
The new rates, which take effect in April and represent the first change in almost a decade, will see companies pay according to calculations that take account of property prices since 2008. It means many businesses in the South East will face soaring rates while others where high-street rental prices have fallen will benefit.
Downing Street yesterday denied that it was in “chaos” over the issue after the Government’s concession to Tory MPs became mired in confusion.
Theresa May had signalled a readiness to help by saying she had instructed Mr Hammond and Mr Javid to ensure “appropriate relief ” for the companies hardest hit. However, her official spokesman later suggested that there would be no extra money beyond an existing £3.6 billion transition fund.
Mr Javid, later clarified matters by saying: “Growing up above the family shop I saw for myself the impact an increase in rates can have ... a rise in costs lowered the mood for the whole family. Even as a child I knew that it wasn’t good when I found a stack of bright red final reminders hidden away .
“My dad was never shy about showing what he thought about out of town retail parks and how that took away customers,” he said. “I can just imagine him telling me about that treatment of large online retailers and how that compares to the more traditional shops on our high street.”