The government has failed to support a third of high street businesses in England who have been promised a discount on their commercial tariff bills, according to new data.
Gerald Eve property experts found that only 272,000 of 400,000 promised businesses, including retailers and leisure and hospitality venues, were able to claim the 50% commercial property tax rebate announced in the latest budget.
The data comes from freedom of information requests to councils in England asking how many businesses in your area have benefited from the discount.
Business fee relief was granted to companies in sectors heavily affected by the pandemic shutdown in an effort to help Main Street recover. Data indicates that 128,000 companies missed the discount and led to calls for the government to ensure that any new support to companies in the upcoming mini-budget is properly targeted.
The main reason only two-thirds of companies were able to access the 50% discount is that the former chancellor has placed a cap of £110,000 on the amount each company can receive, rather than each property. This means that retailers and hotel operators with multiple locations will only benefit from the discount for some of their properties.
This comes as industry experts warn companies could face a total £4.7bn increase in business fees in the next year without action.
UKHospitality is among industry bodies calling for yet another holiday in business rates, as well as a VAT cut, to help businesses grappling with skyrocketing cost inflation and waning consumer sentiment, in the expected-to-be-announced update. on Friday.
Gerald Eve also called on the government to extend the 50% discount next year to support businesses.
Without an extension of the discount, the retail, leisure and hospitality sectors – which were among the hardest hit by the pandemic – can expect their business rates to rise by £1.7bn.
This is in addition to rising rates for the CPI (consumer price index) inflation level for September, which economists predict could be around 10%.
Jerry Schurder, business rate policy lead at Gerald Eve, said: “The new chancellor must avoid the mistakes of his predecessor when he announces support for businesses on Friday. Of course, much of the attention will be on supporting sky-high energy bills, but it won’t make sense if those same companies see their business rates soar.
“In the 2019 manifesto, conservatives promised a fundamental review of rates and a lessening of the burden on the retail sector, but three years later, nothing has been delivered. The new prime minister told companies she wanted to intervene in tax reform. Now she must deliver.”