Finance / Mary Portas warns business rates rise will close a third of independent shops
Mary Portas warns business rates rise will close a third of independent shops
17 February 2017
The planned rise in business rates will kill off a third of independent retailers, "Queen of Shops" Mary Portas has warned the Government.
The retail expert, once hired by David Cameron to find a way of saving Britain's high streets, branded the looming hike "madness" and urged Prime Minister Theresa May to scrap the system completely.
She said the controversial revaluation would be the worst blow to shops since the 2008 crash.
Portas has added her voice to a growing number of business figures speaking out in protest at the plans.
Writing in the Daily Telegraph, she said businesses risked being "destroyed" by increases in their bills of up to 245%.
She said: "In 2011 I was commissioned by the government to look at how we could save our high streets.
“Six years on and we were really making progress.
“So it’s strange to watch our leaders preparing to impose a new business rates revaluation that will cripple high street shops.
“The tax bill, which will hit retailers from April, will be the single biggest blow to independent shops since the financial crisis.
“I would estimate that at least a third of them will die off.”
The Government has said the rates, which are calculated on the rental value of commercial property, will decrease for many businesses due to a fall in property values.
Portas warned that a punitive rise will lead to the return of “clone towns” in which “the only ‘mix’ will be of charity shops, bookies and Costa”.
She said: “I am calling on (Communities Secretary) Sajid Javid, (Business Secretary) Greg Clark, and Theresa May to stop this madness before it destroys everything we’ve been fighting for.”
Brigid Simmonds, head of the British Beer & Pub Association, said a proposed cap on business rates for pubs should be lowered.
“They are, to use the Prime Minister’s words, ‘just about managing’,” she said in a letter to The Times.
“Swift action is needed if they are to thrive as beating hearts of their local communities.”
Business leaders have written to the Government to urge a rethink on plans to tighten the appeals process, making it more difficult for firms to challenge unfair increases in their business rates.
Helen Dickinson, chief executive of British Retail Consortium, which was one of the signatories, said the system is “not fit for purpose in the 21st century” and warned that businesses in deprived areas would suffer.
She told BBC Radio Four’s Today programme: “It will [do damage to business] because what it will mean is that more of the businesses that go through the appeals process and have a justifiable and fair reason for doing so, won’t necessarily be successful.
“That means there will be more businesses that end up paying more business rates than they should and that’s a problem because they are already, in totality, paying too much.”
A quarter of businesses could see major increases in their tax bill after the changes begin in April, she said.
Ms Dickinson went on: “The fact is that there are more prosperous places around the country. Those places will continue to be successful but the gap between those and the more vulnerable, the more deprived areas, will get bigger.
“More businesses will decide to close in those areas that are not doing so well. The system is just not fit for purpose in the 21st century.”