Chancellor says economy ‘stuck’ as Treasury reviews business rates cliff edges
The Chancellor has said the UK economy feels “stuck” as she revealed plans to consider business rates reforms including removing “cliff edges” for small firms.
The Treasury is looking at changes to the current system of business rates – the tax on UK business properties – as part of efforts to cut red tape and improve growth.
In an initial report into business rates, the Treasury said it would consider overhauling small business rates relief rules which “can discourage” expansion and investment.
The current rule means that when a company opens a second property it loses access to all small business rates relief unless it meets specific criteria.
Mounting pressure
It comes as part of the Government’s commitment to review business rates more widely amid mounting calls from firms and business groups for wholesale reform of the system.
It is understood that bosses of major high street firms, such as John Lewis, met with the Chancellor Rachel Reeves last week and encouraged a shake-up of current business rates rules.
Ms Reeves said: “Our economy isn’t broken, but it does feel stuck. That’s why growth is our number one mission.
“Tax reforms such as tackling cliff-edges in business rates and making reliefs fairer are vital to driving growth.
“We want to help small businesses expand to new premises and building an economy that works for, and rewards working people.
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Proving tougher than expected to reverse Thatcher’s hitching of the economy on Europe.
Well Reeves has made it worse by gestures to aggravate everything. There is a global problem of fewer and fewer people having any money while a very few are extremely rich. This situation is untenable and will lead to civil unrest. We’ve already seen it in Sri Lanka and Nepal. Basically the UK cannot afford the massive state expenditure in particular the NHS and the benefits. Thatcher’s contribution was to remove the means of wealth creation but that was 35 years ago.
Just because it was 35 years ago doesn’t make it irrelevant. The decline she set in motion was masked for decades by selling financial services to Europe and house price inflation. The first can be reinstated, the second can be clawed back with IHT on family homes. But the fundamental issue of wealth creation still needs addressing. And Trump-style tariffs to boost domestic industry and manufacturing might be the answer. This isn’t just a matter of economic development but national security as Covid demonstrated. Globally we need the UN to set a cap on individual wealth and minimum corporate taxation.… Read more »