The British Retail Consortium (BRC) has joined growing calls to the UK government to freeze business rates ahead of a planned £800 million increase linked to inflation that’s due to kick in as from April, 2023.
This came only days after the CBI lent its considerable voice to the argument to freeze business rates to help firms that were facing a 10 per cent hike in the next financial year.
BRC Chief Executive Helen Dickinson said that the operating costs for businesses remain high and demand will be tested by a fragile economy and falling consumer confidence ahead of Christmas. Any stay of a business rates hike, she said, would support investment and help keep prices lower for hard-pressed consumers.
An increase in rates in line with inflation, currently running at over 10 %, will see retailers facing higher costs and put future investment projects in jeopardy.
Dickinson went on to call on the Chancellor to make the changes as the BRC released statistics for Q3 that showed the overall shop vacancy rate were almost static at 13.9%, showing just a 0.1% improvement on the previous quarter.
“The overall shop vacancy rate improved for the fourth consecutive quarter; however, vacancies remain higher than pre-pandemic levels,” said Dickinson. “Some locations are benefiting from a pickup in tourism and a gradual return to offices, but levels of footfall are still below those of 2019.”
According to the BRC’s figures , all regions saw improvements in Q3. Overall shopping centre vacancies fell to 18.8% from 18.9%, high-street vacancies decreased to 13.9% from 14.0% and retail park vacancies decreased to 9.7%, the best result with a 0.5% improvement.
London, the South East and the East of England had the lowest vacancy rates, while the highest were in the North East, followed by Wales and the West Midlands.
“The North-South divide is again laid bare in these figures. While the North has seen some of the biggest improvements in openings over the last year, they still have some of the highest vacancy rates in the country, with one in five shops closed in the North East,” added Dickinson.
“Government should freeze business rates and reform the broken transitional relief system. This will support investment in communities across the country and help keep prices low for consumers.”
The Office for National Statistics also recently presented data that suggests the impact of Covid and the associated restrictions had a worse impact than initially thought, on both retail and transportation