Business Rates for Modern‑Biz: The Piercing Reality
Short of Gear‑Up for Friday’s Steam‑Roller – the Chancellor’s press release on business rates the other day felt more like a suggestion than a solution. After promising a clean rewrite of the system, she finally dropped a 40 % relief cap at £110,000, leaving most shops, cafés, and venues doubting whether the 75 % discount we’ve relied on is merely a balloon that will pop in April 2025.
Key Points (And My Thoughts on Them)
- No Consultation – just a discussion document. As if the plan’s been drafted by the chancellor’s own scribbling.
- Cap at £110,000 and a temporary 40 % relief until 2025/26.
- Permanent lower rates for 2026/27 onward – but still dependent on the dreaded 2026 revaluation.
- The small‑business multiplier remains at 49.9p, keeping the under‑£500,000 sector in the same pain zone.
In plain English: if a shoping mall currently enjoys a 75 % reduction, dropping that to 40 % will inflate its taxes by a staggering 140 % next year—a brunt that’s almost instant as the relief hits the bank. And even with two lower multipliers in 2026/27, the 2026 revaluation will fire the bill up again.
Some Dark Consequences
- Larger businesses (≥ £500,000 val) will shoulder a higher multiplier—including those in retail, hospitality, and leisure.
- By “re‑balancing” the tax load, the policy aims to pay the smaller firms for the bigger ones’ job‑making, but the reality is different.
- In the long run, the high‑street brick‑and‑mortar shops are threatened by a wall that’s closer than expected, not a cliff that gets tucked away behind a shoulder‑check.
Why This Is a Bad Idea (And A Good One For Future Power)
Well, if you’re planning on keeping the high‑street alive, you need real reform, not a patch. The Chancellor’s plan:
- Does not freeze the “larger multiplier”—i.e., the tax on the very firms that are creating jobs.
- Leaves no safeguard for business‑rate deserts that pop up in some regions.
- Fails to review and simplify the appeals process, which is still a headache to many small landlords.
To sum it up: the new measures look more like a battle plan for a future war than a practical, everyday fix. The high‑street could stay afloat, but it’ll need a lot tougher, well‑timed measures—one that actually gives a firm hand to those with a few dozen sales, not a big discount that disappears next spring.
And Because We All Need a Laugh (Even When We’re in the Edge)
Thanks to the Chancellor’s “magic” 40 % relief, your rent might decide to take a very huge leap forward—if only for the delight of their accountant. You can picture the shop awnings blowing in an unplanned wind. If we’re many years behind, maybe we should look for a tax amendment that’s more like a comfort cushion than a fingernail on the quick.
