The British Retail Consortium has called on Labour Chancellor Rachel Reeves to reform business rates to support the UK retail sector.
In an open letter signed by bosses at ASOS PLC (LSE:ASC), Aldi, Asda, Currys, Primark and dozens more, the BRC pleaded for a 20% reduction in rates bills for all retail properties.
According to the BRC, the retail sector accounts for 7.4% of all business taxes in the UK, which is 1.5 times greater than retail’s share of the overall economy.
Taxes account for 55% of the retail sector’s pre-tax profits, which, alongside hospitality, is the highest proportion of all main business types.
The open letter stated: This tax burden is having a detrimental socio-economic impact on local communities through store closures and job losses – in two-thirds of the 6,000 store closures in the UK over the past five years, the rates bill had a material impact on the decision to close.
“Rates are also holding back current investments we want to make in pay and upskilling our people, in new and improved stores and in the technology that will support productivity and economic growth.”
Retail bosses said they welcomed Labour’s acknowledgement that “the rates system disincentivises investment, creates uncertainty and places an undue burden on our high streets”.
Now, they want to see Labour’s pledge for a fairer system for the bricks and mortars put into action.