Over 70 leading retailers, including Tesco, Marks & Spencer, and Ikea, have united to call on Chancellor Rachel Reeves for a significant overhaul of the business rates system.
They are advocating for a 20% reduction in business rates to create a fairer tax environment for the retail sector.
The British Retail Consortium (BRC) highlights that retailers contribute 7.4% of all business taxes while accounting for only 4.9% of the UK’s economic output.
This imbalance has led to reduced investment and numerous store closures, adversely affecting local employment and communities.
The retailers propose a ‘retail rates corrector’ to lower business rates for shops by 20%, aiming to level the playing field across industries. Without reform, the BRC warns that around 17,000 shops could close over the next decade.
High business rates are hindering investments in employee training, store improvements, and technology—key areas necessary for boosting productivity and economic growth.
This appeal comes as Labour prepares for its first budget on 30 October. The party has pledged to reform the business rates system in England, although specific details remain unclear.
Helen Dickinson, BRC chief executive, said: “Retail has been the golden goose, generating tax revenues far beyond the industry’s size, but the current situation is not sustainable.
“The government should act to rebalance the system and ensure all industries are paying their fair share. This in turn would drive increased retail investment in people, places and communities.
“The budget is the perfect opportunity to lay the groundwork for local investment that delivers for retail’s customers, delivers for its employees, and delivers for the economy.”
The upcoming budget presents a crucial opportunity for the government to address these pressing concerns.
