Iceland has joined in the call for Tory leadership candidates to rethink “outdated” business rates as the company’s managing director, Richard Walker, reportedly urged the prime minister to promise a “root and branch” reform of the tax.
His intervention, according to This is Money, follows similar calls from other UK supermarkets that are part of the Retail Jobs Alliance (RJA), a consortium of retailers which includes Tesco and Sainsbury’s.
This is Money also reported that RJA members employ more than a million people, which makes up a third of all jobs in the sector, and last week it said to have accused Sunak and Truss of “failing to prioritise the High Street”.
Current business rates are reportedly based on rental value not profit, and as Walker has stated, reform is “especially important” as hard-pressed shoppers turn to discount retailers such as Iceland, which has close to 1,000 stores around the UK.
In light of the current cost of living crisis, Iceland has also recently locked the price of its £1 value range until 2023, meaning it now sells the products at a loss.
Front-runner Truss, the foreign secretary, has promised to “cut taxes from day one” if she becomes PM, while former chancellor Sunak would scrap VAT on fuel.
Walker said: “Our business rates bill is well over £40m a year. It’s just unfair. You have massive online businesses who are getting a piggyback for free.
“I think it’s right to call out that a few percentage points increase in corporation tax is not a big deal. In return it’s absolutely about jobs, productivity, levelling up and high streets which need business rates reform.”
Walker also said business rates reform would also encourage more retailers to open businesses, which would revitalise town and city centres.