Food retailers call for business rates freeze
Published:  16 October, 2012

Leading food and grocery retailers have united in a bid to urge the government to freeze business rates in 2013.

Ken McMeikan, chief executive of Greggs, joined the heads of a number of grocery and food retailing businesses to sign a letter, written by the British Retail Consortium (BRC) as part of its Fair Rates for Retail campaign, to the Financial Times.

It comes as September’s Retail Price Index figure was announced this morning by the Office for National Statistics (ONS), revealing a drop in the Consumer Prices Index (CPI) measure of inflation from 2.5% in August to 2.2% last month. The Retail Prices Index (RPI) measure of inflation for September also fell to 2.6%, from 2.9% in August.

The letter reads: “If the government follows previous practice and translates it directly into next year’s business rates rise, as much as £200m will be added to the retail sector’s bills for 2013. This would follow eye-watering increases in both 2011 (4.6%) and 2012 (5.6%), a cumulative rise of more than half a billion pounds.

“As the sector which pays the largest share of business rates (28% of the total), another steep successive rise would deal a blow to retailers’ ability to invest in stores and create jobs, especially in these tough trading conditions. That would mean more empty shops on high streets and fewer employment opportunities, especially for young people.”

The letter adds that the retail sector has already given more than its fair share to the Exchequer, and the government should act on its commitment to review the mechanism by which rates are increased for a fairer playing field.

In total, 14 retail leaders have come forward to show their support and sign the letter, including Andy Clarke and Dalton Philips, chief executives of Asda and Morrisons respectively, alongside Stephen Robertson, director general for the BRC.

Robertson said: “This RPI announcement reveals the scale of the potential damage to our high streets that will follow if the government follows previous practice and translates it directly into next April’s rates increase.

“The retail industry is the UK’s biggest private sector employer, providing crucial first jobs to a million 16- to 24-year-olds. Expecting retailers to bear a huge rates hike for the third year running can only lead to fewer chances of work, less investment and more troubled high streets.”




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