Business rates reform under fire from retail sector
Changes to the business rates policy are due to take effect in April 2026. The plan is to lower business rates for properties with a rateable value of less than £500,000. This will be funded by increasing business rates for properties with a rateable value over £500,000.
As reported by City AM, the government’s plan has come under fire as “stifling investment and growth” (John Webber, Colliers). The rises will hit hard for bigger retailers located in prime shopping areas, such as the West End.
But it is often those bigger retailers that are the anchor tenants in the regional shopping centres and high streets. And if those retailers are forced to reduce their footprint, where will they withdraw from first? If the anchor tenants withdraw, there will be less drive for smaller retailers to set up shop and for consumers to visit these regional spaces as well.
If consumers are not incentivised to visit regional shopping centres and high streets by the draw of their favourite big brands, the smaller retailers will likely be hit by lower sales because of the reduced footfall. Could this cancel out any benefit they will receive from lower business rates? And will it discourage smaller retailers from growing into bigger spaces?
So, whilst the general consensus is that business rates reform is necessary and overdue, there is little confidence from the industry about the government’s current plan.
Subcribe to news and viewsNew business rates policy “unlikely to save the high street” according to investment firm Colliers
https://www.cityam.com/business-rates-to-hammer-the-west-end-this-whole-policy-is-nuts/
