The government has been urged to overhaul the ‘broken’ business rates system by the Treasury Select Committee.
According to the Committee, alternatives are needed to protect struggling high street retailers. The Committee published a report highlighting businesses’ concerns that the current system places greater costs on physical stores – as well as manufacturers – than online outlets.
It states that since being set up in 1990, revenues generated by the tax had outpaced inflation and reached £31 billion in the last financial year, but that it was now in ‘urgent need’ of reform.
Alison McGovern MP, the Committee’s lead member for this inquiry, commented on the report saying: “It’s abundantly clear that the current business rates system is broken. The tax represents an increasing burden on businesses, particularly those with a physical high street presence struggling to remain competitive.”
Quote from Nigel Holland:
“More and more high street businesses are having to close down due to these high rates and lack of custom. Online businesses are more convenient for the customer and less profitable for the producer, eventually there will be no physical shops left”