Business rates bills will be cut by a third for almost half a million small retailers in the budget today.
The chancellor is expected to announce the cuts for 496,000 small businesses, along with £900m of immediate relief, in a bid to help the country’s failing high streets and small business owners.
A £650m transformation fund for high streets, including the improvement of infrastructure and transport, is also expected to be announced as part of the efforts to resurrect the UK’s high streets.
Another predicted budget reform is a review of relaxing town planning rules, in an effort to ease the conversion of under-used retail units.
Experts, however, are still fearful that these measures will not be enough.
Chief executive of the British Retail Consortium Helen Dickinson OBE said: “Struggling high streets require a broader outlook in order to thrive, particularly given the majority of the UK’s 3.1 million retail workers are employed in businesses that will not benefit from this announcement.”
She added: “The underlying issue remains that the business rates burden is simply too high and this unsustainable system needs less tinkering and more wholesale reform within the context of the wider taxation system.”
Although Head of UK business rates at real estate advisor Altus Group Robert Hayton said the announcement “will almost certainly make trading on the high street more attractive through lower rates and will offer some respite to smaller premises”, he was still concerned about the funding’s effect on struggling larger businesses.
He said: “Larger premises already pay £626 million a year extra in rates contributing to the existing small business rates relief scheme through a supplement of 1.3p on the standard tax rate and, unless this commitment is funded by way of a new digital services tax or through central funds, I’m concerned the burden may simply be transferred onto medium and large businesses, increasing their rates liabilities even further, which would be counterproductive at a time when major retailers are reducing their store portfolios and headcounts.”