The Booksellers Association (BA) and more than 50 major retailers are calling on the government to take the first steps towards fundamental business rates reform in the upcoming budget.
The letter focuses on fixing the transitional relief system which has cost the retail industry more than £500m in the past three years, according to the British Retail Consortium (BRC).
The transitional relief system limits the speed at which a firm’s business rates liability changes in response to changes in its rateable value. The current system has two consequences according to the BRC— "it forces retailers to subsidise other industries: £543m net over the past three years and it forces locations outside London to subsidise London businesses: £596m net over the past three years".
BA m.d. Meryl Halls said: "The BA has been lobbying on business rates reform for many years, and working closely with the BRC on all pro-high street work they are doing. Joint letters of this sort are effective collaborations between retailers and trade bodies, and also illustrate the point that the clamour for rigour and clarity in rates reform is universal and urgent. We are delighted to sign this latest letter, reiterating the need for review and reform of the taxation and rates system, and reminding the government of the crucial role retail plays on our high streets. Bookshops of course play an exceptional role on those high streets lucky enough to have one, and we know the added benefit that bookshops bring to their communities, their local cultures and to their customers, over and above the commercial drivers they represent. The BA will continue to fight on behalf of bookshops, and to work together with partners and collaborators who can help us deliver an improved situation."
Co-ordinated by the BRC, the letter, signed by the BA and businesses including Asda, Sainsburys, and Morrisons, was sent earlier today to then-chancellor of the exchequer Sajid Javid. Following today's Cabinet reshuffle, The Bookseller understands the letter will also be sent to new chancellor Rishi Sunak.
BRC c.e.o. Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said: "We welcome Rishi Sunak as the new Chancellor. His appointment comes at a vital time as more than 50 retailers wrote to the Chancellor’s office calling for Transitional Relief to be fixed. This would be an important step towards reforming the business rates system and building a better environment to allow businesses to thrive. It is essential our new Chancellor makes good on the Government’s pledge to reform this broken system.
"The future of retail is an issue that matters to people across the UK, yet transitional relief undermines both the industry as a whole, and the many regions that it serves. Since 2017, retail has been forced to pay £550m to subsidise other industries, money that could be used to support investment in people and technology that would benefit all parts of the UK. Every year retail faces higher and higher business rates bills, holding back much needed investment in an industry that is transforming at a dramatic pace. Swift action at the upcoming Budget would show the Chancellor was serious about levelling up all parts of the UK and supporting a retail industry towards realising a brighter future."