The retail and hospitality sector will be nervously eyeing up June 30th after planned changes to business rate reliefs come into effect for a post-pandemic restart.
In the March budget chancellor Rishi Sunak announced the current 100% business rates holiday for the retail and hospitality sector would be extended to the end of June, with a further discount for the remaining nine months of the financial year by two thirds, but this only applies up to a value of £2m for any closed businesses.
It is looking likely that many medium and large-sized retailers will be caught by the limit and face hefty business rate bills post June 30.
In Scotland and Wales, because of devolved powers, businesses are being offered more protection from the hike, with 100% rates relief through until March 2022.
Some rating experts are calling for the Government to scrap the £2m cap for the retail sector which will have only had weeks not months of trading, and the vast majority of those with social distancing restrictions.
Another issue facing hard pressed retailer is the moratorium on retail evictions is also due to be lift on the same day.
Businesses will be watching the Treasury closely for any signs of relenting on the June 30 deadline, however, strong trading figures – released since lockdown restrictions on non-essential retailers were relaxed in April – could persuade the Chancellor there is enough momentum on the high streets to justify trying to claw back more revenue via business rate. Retail sales in the UK surged 9.2 percent month-on-month in April, the 3rd highest growth rate on record.
The Government’s own figures say around 83% of all businesses are currently back to full trading. With less than one month to go and uncertainty over the June 21 “Opening Up” day, if there is any change of heart, the Government will need to announce it sooner rather than later.