Revo, which supports businesses in the retail property and placemaking sector, has called on the UK Government to “make good” on its stated commitment to a fundamental review of the business rates system.
The organisation said the review is “crucial” to ensuring that the UK remains “internationally competitive”, particularly after it exits the EU, and that its towns and cities are able to “thrive in the future”.
Ahead of the upcoming budget, Revo has written to the Treasury with its expectations of the Government, outlining the following principles for a reformed business rates system:
- Create an internationally competitive rate of tax that can be adjusted annually to reflect changing economic conditions
- Reduce the burden levied on physical business through introducing some form of digital sales tax
- Fully resource and invest in the business rates and appeals infrastructure, including new technology and extra human resource
- Remove downwards transitional phasing so that any benefit from a fall in business rates as a consequence of revaluations is applied in full immediately
It also emphasised to the Government the importance of local infrastructure and the role of the Town Centre Fund in delivering vital improvements.
Revo said business rates tax has risen from 34% to 50% of rateable values since 1990, making it one of the “highest corporate taxes in the world”. Around 24% of business rates revenues are delivered from the retail sector, equating to about £7bn.
Ed Cooke, CEO of Revo, said: “The Government must deliver on its commitment to review the business rates system, and act swiftly and radically. Inevitably this should include considering a form of digital sales tax to allow for an immediate reduction in business rates, which at more than 50% is one of the least competitive corporate tax rates in the world.
“We call on the new chancellor to put in place a system that allows for the iniquitous downward transition policy to be abolished, which would signal meaningful support for retail businesses, particularly in areas where the Conservative Party was lent votes in last year’s general election.”