Retail workers are cautioned against bearing the burden of business rate reforms, as emphasized by a joint plea from the shop workers union Usdaw and the British Retail Consortium. The call to safeguard shops and their employees in the upcoming Budget in November comes as the retail sector faces significant challenges, with 350,000 jobs lost and over 10,000 shop closures in the past year alone among the nearly 3 million retail workforce in the UK.
The Labour Party has pledged to revamp business rates to revive high streets, proposing a permanent reduction for retail, hospitality, and leisure properties starting next year. However, to finance these changes, the Treasury is contemplating raising business rates for large non-domestic establishments like office buildings and banks, raising concerns about potential impacts on larger retail stores.
Usdaw’s Joanne Thomas and the British Retail Consortium’s Helen Dickinson expressed worries that the proposed changes could negatively affect supermarkets and anchor stores, potentially leading to reduced employee hours, more closed shops, and job losses, ultimately impacting consumer prices. They emphasized the ripple effect of cost increases on prices and the adverse impact on working individuals and union members.
The Government is urged to exclude shops from a new higher business rates band and instead target larger office blocks and commercial buildings for increased rates. The emphasis is on preserving fair treatment, protecting jobs, and enhancing living standards without burdening retail workers in the pursuit of financial balance.
In response, a Treasury spokesperson outlined plans for a fairer business rates system to support the high street, promote investment, and introduce lower tax rates for retail, hospitality, and leisure properties beginning in April. The sustainable funding for these lower tax rates will come from a higher rate on less than 1% of the most valuable business properties, with long-term strategies in place to support small businesses and address system inefficiencies.