What does the future hold for the struggling high street?

November 14, 2018 / News & General

Business chiefs have attacked the Government’s reforms of business rates, warning that the changes won’t help large retailers engulfed by a surge in recent High Street closures.

In last week’s Budget announcement, Chancellor Philip Hammond unveiled a series of measures designed to help struggling retailers. These included a £675 million High Street fund, along with plans to reduce rates bills for retailers with a rateable value of £51,000 or less.

However, company bosses warn that the change in rates won’t help the multitude of large chains that have faced financial problems in the last year.

Many large retailers hoped that the Budget would outline measures designed to help chains compete against online rivals, keep on top of rising rents, and overcome the burden of business rates.

David Atkins, the chief executive of Hammerson (a property development and investment company) said that although small firms are likely to be relieved by the news, “for large retailers, there is little to feel good about.”

He added: “Big brands shoulder almost 70% of the rates burden. It is in everyone’s interest that larger retailers are also given the chance to prosper by operating on a level playing field and the current business rates burden does not allow this.”

Harrods’ managing director Michael Ward also feels strongly about the lack of positive changes for large businesses. He said: “Without a drastic review of this outdated business rates tax system, and a recognition of the undue burden it places on London businesses with high property values, bricks and mortar retailers will continue to suffer.”

Iceland’s managing director Richard Walker suggested that the Chancellor’s proposals won’t help to level the playing field between online and traditional retailers.

He tweeted: “Our business rates bill alone amounts to roughly 10% of the £400 million that the Government is looking to raise from taxing the tech giants, some of the largest companies in the world.”

The UK high street is suffering what many believe to be its worst year on record, with many companies going bust and others fighting to keep their heads above water.

Statistics from the government’s Insolvency Service showed the biggest rise in UK company insolvencies since the depths of the financial crisis.