The Queens Speech has always been an opportunity for the government to release information regarding policy changes for the new parliamentary year. This year is no different and we were watching eagerly in anticipation of some positive business rates news.
As many are aware, business rates have been a contentious subject for some time now. Many believe they’re poorly implemented and in need of reform. They’re even credited as being partially responsible for our disappearing high streets. Naturally, you’d expect them to feature heavily in any government announcement concerning businesses in the UK.
Chancellor Rishi Sunak even underlined his support for small businesses in a recent trip to Ipswich, where he claimed small companies to be “The heart of the economy.”
This is all well and good, but what’s being done for small businesses to help them thrive?
An announcement to keep the pavement license alive is welcome news, this was introduced over the pandemic as a means for our favourite bars, cafe’s and restaurants to be able to continue to offer alfresco dining to customers all year round. It’s nice, but it's not revolutionary.
Keeping a 50% business rates relief system for retail, hospitality, and leisure is nothing new. It’s less of a reduction than we’ve seen for these industries over the past years. If this relief was to disappear suddenly, it would spell the end for many of our favourite establishments overnight. Slashing the relief handout to these industries and selling it as part of a support package gives the impression that the government isn’t taking their concept of levelling up our high streets very seriously.
Also mentioned in regards to revamping the current business rates system, is shortening the rating period from 5 years to 3. The idea here is that with business rates being reviewed in a shorter cycle, it’s less likely that companies will be overpaying on their rates and the process can be kept in check.
This isn’t promising much or even anything at all. Businesses have always been able to appeal and make attempts to reduce their rates. Many use a professional agent such as ourselves, to ensure the process is optimised. So how is this helping businesses survive in the current climate? Is there more to the “business rates shake-up” announcement that we’ve been waiting for, than this?
Business rates need to be reformed not because the system doesn’t work (which it doesn’t) but because they’re too high. Many companies can’t afford to pay them, as well as their other overheads, without facing the prospect of going under.
We want to see a reform that directly reduces the business rates payable, and allows for more companies to thrive.