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Summary
- The review of the business rates could be delayed for the November budget, says news report.
- Some schemes might get an extension this budget such as furlough and business holidays for selected sectors.
Chancellor of Exchequer Rishi Sunak is expected to delay the final report on business rates’ review for the November, a Financial Times news report stated. The business rate report is a crucial part of Sunak’s promise for providing a level-playing field between online and high street retail.
By postponing the report to autumn, Sunak will be able to make a better decision as the economic uncertainties due to the pandemic would have receded by then.
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In his forthcoming budget, Sunak might extend a year-long business holiday for retail, leisure, and hospitality, to help the hard-hit sectors due to the pandemic-led crisis. Most exemptions and support measures will expire on 31 March. This week itself, Scotland’s devolved administration has also announced to extend rate relief for the sectors of hospitality, leisure, and retail for yet another year.
The job furlough scheme is also expected to be extended into the summer before it may be finally phased out. Going forward, Sunak could retain some measures to support employment even after the furlough scheme ends, it has been reported by the newspaper. The temporary £20-a-week upliftment in universal credit is also likely to be extended by a period of six months.
The business rate review is very crucial. The yearly collection of business rates is nearly £25 billion in England. A 2 per cent tax on online sales would raise close to £2 billion every year for the government.
Sunak also wants to tax the tech biggies by imposing a digital service tax.
With the government’s planned delay, the high street retail community is getting more restless. Helen Dickinson, CEO of the British Retail Consortium, said delays in reforming the system would add to job losses in the sector. She has urged the government to lower the business rate burden on the ailing physical retail industry.
But the views on overall structure of the business rates in the long-term vary with some retailers in favour of overhauling the system to be more responsive to changes in rent while others advocating for an online sales tax.
