...while Chancellor set to give £300m tax cut to shops
PHILIP Hammond is eyeing a £300million tax cut for shops in Britain’s most deprived town centres as pressure mounts on the Government to help high street retailers.
The move could be introduced from April and would mean an instant reduction in bills for the next two years.
Scotland has its own business rates system, which will be unaffected by the Chancellor’s decision. However, any tax cut in England and Wales would increase pressure on the Scottish Government to offer similar support to high streets north of the Border.
The Government is weighing up the plan as part of a package of measures that could include a tax on digital firms. It is facing growing pressure to level the playing field on tax to help domestic firms and was last night called on to demand greater transparency from global corporations operating here.
Multinationals are accused of using complex company structures to reduce their tax bills. The Tax Justice Network told The Mail on Sunday that powers enshrined in the Finance Act 2016 gives the Treasury the ability to demand firms publicly state country-by-country financial data. That would heap pressure on them to pay an additional £2.5 billion a year in tax, the group says.
It estimates that the total underpaid tax of all foreignbased multinationals operating through British subsidiaries is around £25 billion.
A report due to be published tomorrow by Tax Justice Network says: ‘The UK Government has already legislated to be able to require publication, so no further parliamentary time is needed. All that is required is for the Chancellor Philip Hammond to simply announce that this legislation will now come into force – which he could do at any time.’
A cut in business rates may form part of a wider £800 million cut for firms operating in areas where property values have slumped.
Those companies have been saddled with artificially high business rates due to what is known as ‘downward transitional relief’, which the Treasury is considering removing.
The system means that, instead of immediately seeing bills fall after the last seven-year revaluation, reductions are phased in over the period.
Robert Hayton, head of UK business rates at Altus Group, said: ‘Abolishing the strict limits on rate reductions would put fairness back into the heart of the system, providing badly needed respite.’
The Mail on Sunday first reported two years ago that transitional relief was hastening the demise of town centre shops in struggling regions. Shops that should have seen bills fall have since overpaid on rates by £1billion.