The government is to offer additional help for small businesses affected by a forthcoming change to business rates, the communities secretary has announced, saying that more should be done “to level the playing field”.
Following concerns raised by some businesses and Conservative MPs about the impact of the first business rate revaluation in seven years, Communities Secretary Sajid Javid said the chancellor, Philip Hammond, would announce new measures in the budget on 8 March. This would form part of a long term re-examination of the business rates system, he added
The Chancellor Philip Hammond has told Tory MPs he was “alive” to the impact the changes will have on some businesses and was “open” about ways to help.
Mr Hammond also indicated he wants a reform of the system in future to make sure online retailers such as Amazon do not benefit to the disadvantage of the high street.
Speaking in a Commons debate on local government finance, Javid said the rates revaluation would see 75% of all businesses pay the same amount or less than before, adding “I am also acutely aware of the impact on the quarter that will see increases,” he continued. “If your rates are going up, it’s no consolation to hear that others’ will be going down. I’ve long recognised the need to provide support.”
The transitional relief fund would help over 140,000 smaller businesses, Javid said, adding: “But as colleagues and the media have highlighted in recent days, there are clearly some individual businesses facing particular difficulties.”
Javid said a particular problem was faced by smaller shops in areas that have seen high increases in rent, since the rates are based on rentable values, and by businesses facing “an alarming cliff edge” after losing their entitlement to rate relief. “I have always listened to businesses, and this situation is no exception,” he said. “It’s clear to me that more needs to be done to level the playing field and to make the system fairer.
“I’m working closely with my right honourable friend the chancellor to determine how best to provide further support for businesses facing the biggest increases. We expect to be in a position to make an announcement at the time of the budget in just two weeks’ time.”