The British Independent Retailers Association has lobbied Parliament over its proposal to reform business rates.
The organisation, which represents thousands of independent retailers in the UK and of which the NAHS is a part of, presented its plan for business rates reform to MPs at the Houses of Parliament. Bira asked MPs to consider changing the current £12,000 threshold to an allowance as a much-needed short-term solution. It is bira’s belief that an allowance would help the majority of small businesses and make the difference between closing or surviving in 2018 and beyond.
Retailers pay nearly one quarter of the collective business rates bill, some £7bn annually, far more than any other industry. With business rates not being charged on a business’ profitability, it is bira and its members contention that this creates a system that fails to place the burden of taxation on those that are most able to pay. Bira believes that an allowance would mean simplification of the relief system. It would mean that there would be no need for a Small Business Rates Relief as there would be a standard application for all businesses across the country, as opposed to the complicated system at the moment, which varies from council to council and currently costs the Government £2.6bn.
The visit to the Houses of Parliament follows a two-year campaign, with engagement including representation to a number of Parliamentarians and Government departments to discuss proposals, notably Number 10 and the Treasury.
Alan Hawkins, outgoing CEO of bira, commented: “Whilst the Government offered some help to smaller businesses in the last revaluation, by doubling the Small Business Rates Relief threshold from £6,000 to £12,000, (and tapered relief up to £15,000) this doesn’t help the majority of retailers, who, on average, have a rateable value of £34,000.
“We propose a simple allowance, ahead of a full review of the system, using the same principles of the personal allowance applied to income tax, and through this, we believe the majority of those businesses struggling with their tax would see a reduction in their rates. All those below the allowance (which could be, for example, £12,000) would be out of the system completely, cutting down the resource needed to process these.”
He continued: “Bricks and mortar retailers are already at a disadvantage and being asked to compete on an unlevel playing field. Many retail businesses saw an increase in their rates bill last year, whilst the average bill for Amazon fell by 1.3 per cent. Our proposal would redress some of the balance, as an allowance would automatically reduce the bill of those businesses that need the most help.”
Geoffrey Clifton Brown MP, who is championing the campaign, added: “I was extremely impressed and encouraged by bira’s proposal. It offers a simple and practical method, which would bring instant relief to many thousands of hard-pressed retailers, who are the back bone of our country.”
Surinder Josan, National President of bira for 2018-19, also advised: “Retail has evolved over the last decade. New businesses entering the field are pushing the way forward, bringing in new and exciting ways to reach customers. The business rates model, which was applicable decades ago, is simply no longer fit for purpose. It’s time to apply a new method of taxation to address the imbalances across the bricks and mortar and digital landscape.”
In other bira news, the organisation has announced that Andrew Goodacre will be its new CEO Goodacre, formally of the Residential Landlords Association (RLA), will replace Hawkins, who retires after 33 years with bira. He brings with him a wealth of experience within the membership organisation sector, having held the role of CEO at the RLA since 2013 and previously holding a senior position at the Federation of Small Businesses (FSB). Before that, he gained significant experience within the hospitality sector.
Chris Patterson, who led the recruitment committee, commented: “Andrew’s appointment comes at a crunch point within retail; with the rise of online shopping, the disproportionate and unfair business rates system, ever-increasing pressures on retailers, alongside Alan’s retirement, now more than ever we need strong leadership from our trade association. Andrew’s rich experience of lobbying Government and increasing membership levels will help put bira at the centre of the High Street debate, while his relaxed, collaborative style will encourage engagement from both members and staff alike to ensure independent retailers can not just survive, but thrive once more.”