Two Magpies Bakery in Southwold has hit the national press after advertising sausage rolls for £8.17 – a 177% mark-up on the usual £2.95 price tag.
Owner Rebecca Bishop said the increase is the same as the business rate hike her business is set to face.
Small bakeries are bracing themselves for the new rates, due to take effect in April, with some concerned they may not be able to weather the storm.
Bishop said her annual bill was set to jump by almost £10,000 because her shop’s rateable value had gone from £7,200 to £25,500, making her ineligible for small business relief.
Every small business in Southwold is facing a business rates increase – the largest is 245% and the average 177%.
But the sausage roll hike is just a gesture, because Bishop said it is unfeasible to raise her prices to cover the cost: “It’s all going to come off the bottom line, so what that means is either retraction or closure.”
Southwold’s business rates threaten the livelihoods of its many independent shopkeepers, a picture that will be replicated in affluent towns and cities across the UK where property values have risen since the last revaluation.
The business rate is a tax is calculated on the rental value of a property as estimated by the Valuation Office Agency – this is supposed to be recalculated every five years.
Stephen Britt from Suffolk Chamber of Commerce, based in Ipswich, said he thought the system for working out business rates needed “a massive overhaul” because it could not be applied fairly across the country.
“It is imperative the government listens and acts quickly to implement a fairer, simpler and less burdensome system that at its worst penalises good businesses and blights whole business clusters, including high streets.”
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