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Business Rates leap and what to do about it

Posted 24 October 2022 | Feed Icon | 0 Comments

A multi-billion pound business rates hike will be a severe blow to struggling companies, especially high street retailers, according to industry specialists.

The tax is linked to the September measure of consumer prices index (CPI), confirmed at 10.1 per cent on 23rd October 2022.

It will add an alarming £2.7 billion to bills, just as pandemic-era rates relief for businesses such as shops, cafes, cinemas and bars end.

Property consultancy Gerald Eve says that this is the biggest annual jump in the business rates levy for 32 years. "Businesses are quaking in their boots. Huge business rates hikes are not the way to grow our economy and attract inward investment."

Corporation tax is also expected to increase from 19 per cent to 25 per cent costing firms £12.4billion in 2023-24.

Martin McTague, chairman of the Federation of Small Businesses, said: 'With rates help for many firms ending in March, higher rates bills in April will be a hammer blow at precisely the wrong time.'

He said it 'risks worsening the vicious circle of decline seen in too many of our towns and high streets'.

Kate Nicholls, chief executive of trade body UK Hospitality, said: "There is a real risk that hospitality businesses will face an enormous cliff edge in April if these numbers are used to hike the business rates tax level."

Retailers have long called for an overhaul of business rates, which they say unfairly burdens those with high street stores compared to online sellers.

The Retail Jobs Alliance, which represents the likes of Tesco, Sainsbury's and Kingfisher that together employ over 1 million staff, said there was an "urgent" need to freeze rates, followed by "proper reform".

How to protect yourself from the Rates uplift

If you haven't challenged your current business rates valuation, now is the best time to do so, to mitigate business rate increases at a time of surging cost inflation. Fortunately BSA Buying Group can help you. Click here for more details on how we can help reclaim previously paid Business Rates. Note that the most recent revaluation came into effect in England and Wales on 1 April 2017, based on rateable values from 1 April 2015. The next revaluation will come into effect on 1 April 2023, based on rateable values from 1 April 2021. There are no upfront fees, with our business rates specialist taking a slice of the total tax saving achieved.

by Peter Smith | 24 October 2022

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