Chancellor delays business rates decision until Covid-19 eases

Government borrowing figures for January of £8.8bn released today were a new record for the month.

Oxford Street
Shop owners want online competitors to pay more tax

Rishi Sunak, the UK’s Chancellor, has pushed back a comprehensive review of business rates until the Autumn.

Business groups have long claimed that the way rates are levied hugely penalises those with premises such as shop owners, pubs and restaurateurs relative to online businesses.

The rate is based on the rentable value of a property with a built-in inflation multiplier.

Retailers want an online sales tax to be introduced to balance up what say is an uneven trading playing field.

The Chancellor will say it will be easier to determine the best course of action when the conditions surrounding Covid-19 have eased, the FT reported.

Some comfort for hospitality groups, leisure venues and retailers is that they are likely to have the current Covid-19 inspired business rates holiday extended in next month’s Budget, the paper added.

The Chancellor has a tricky balancing job between support measures to keep the economy afloat and trying to claw back some of the huge sums of money he has spent so far during the pandemic.

Government borrowing figures for January of £8.8bn released today were a new record for the month.

In what is normally a peak tax collecting period, borrowings also exceeded revenue for the first time in a decade.

Government borrowing in the current fiscal year has now risen to £270.6bn or £222bn more than a year ago with the total for the full year expected to be £394bn according to forecasts by the Office of Budget Responsibility.

That would be the highest annual borrowings total since the Second World War.

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