Councillor calls business rate relief cuts a ‘sure-fire way to lose a high street’

Cuts to a Wales-wide business rate relief programme are a “sure-fire way to lose a high street”, a councillor has warned.

Nigel Dix, a Caerphilly county councillor said traders in his hometown of Blackwood were “struggling to make ends meet”, and the high street had lost two banks and “major retailer” Wilko.

He said the Welsh Government’s proposal to cut rates relief from 75% to 40% next year was another “spanner thrown in the works” for businesses.

‘Just about managing’

The Welsh Government defended its “generous” programme of business support and said “almost half of ratepayers, including thousands of small businesses across Wales, do not pay rates at all”.

Cllr Dix, an independent from Blackwood, said there were traders “just about managing” financially, adding that “we need to make sure we have a high street that’s going to be there in the future”.

Speaking to the Local Democracy Reporting Service (LDRS), he said he feared businesses were “going to fail” as a result of the lower rate relief offer included in the Welsh Government’s draft budget proposals for 2024/25.

“It’s going to make maintaining a business in the town even more difficult than it already is,” Cllr Dix said, warning that traders were “going to need to find 35% more income”.

“It’ll lead to more empty shops – that’s not going to be better for anybody,” he added. “We’ll end up with nothing. It’s a sure-fire way to lose a high street.”

When she announced the draft budget proposals on December 19, Welsh Government finance minister Rebecca Evans said the 75% programme of “temporary” relief was “never intended to continue indefinitely”.

“Our move to more frequent revaluations will ensure that non‑domestic rates bills better reflect up-to-date market conditions for all sectors of the tax-base,” she added.

Welsh Government support

Responding to Cllr Dix’s comments, a Welsh Government spokeswoman said: “We are providing a package of rates support worth £134 million next year on top of our permanent relief schemes, which are worth £250m a year.

“Thanks to our generous system of full reliefs, almost half of ratepayers, including thousands of small businesses across Wales, do not pay rates at all.”

The Welsh Government was “providing a fifth successive year of support for retail, leisure and hospitality businesses with their rates bills, at a cost of £78m,” she added. “This builds on the almost £1bn of support provided in rates relief schemes to these sectors since 2020/21.”

“We have taken the decision to cap the increase to the non-domestic rates multiplier for 2024-25 to 5%, at a recurring annual cost to the Welsh budget of £18m,” the Welsh Government spokesperson said. “This is the maximum level of support affordable using all of the consequential funding which came to Wales as a result of decisions relating to the multiplier announced in the UK Government’s Autumn Statement.”