Supermarkets set for higher business rates payments in Budget
Supermarkets are set to face a jump in business rates payments at the Budget following a reported Treasury U-turn, with retail bosses warning the move could lead to higher prices for shoppers.
The caution comes amid a backdrop of cost hikes for the sector earlier this year and elevated food inflation for UK shoppers.
The UK Government is planning to introduce a new business rates “surtax”, which will mean many larger commercial properties will face a higher rate of the property tax in order to help fund a permanent discount for smaller retailer, leisure and hospitality firms.
The higher tax level is set to be applied to commercial properties with a rateable value above £500,000, although the extent of any increases have not been announced.
Last month, it was widely reported that supermarkets were expecting to be made exempt from the higher level after criticism from industry bosses.
Marks & Spencer had said proposals for the surtax would be “encouraging retailers to close larger high street stores”.
However, the Financial Times reported that the Treasury has now indicated that big supermarkets will be hit by the tax change at the Budget announcement on Wednesday.
Helen Dickinson, chief executive at the BRC, said: “Retail is 5% of the economy, but pays over 20% of all business rates.
“The Chancellor promised that these reforms would rebalance business rates across the economy to support our high streets.
“If she chooses to land large retailers with an even bigger burden, now and in the future, it will be our high streets that suffer, with fewer jobs, less investment, and higher prices for customers.”
The Treasury has been contacted for comment.
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“Supermarkets set for higher business rates payments in Budget”. So what that means is that prices of goods on the shelf will increase. It does not matter what is announced in the budget the buck will end up with the ordinary person in the street because businesses and the wealthy have the means to pass any increases on to us but we don’t have the means to do the same. Budgets are designed to hit no one but us!!
Excessive supermarket, oil company and bank profits need to be taxed more. This surtax will be passed onto us and profits will continue to grow unaffected.
This should be aimed at the massive out of town warehouses, not high street supermarkets which already charge much higher food prices to those without the luxury of a car.
Looks like it is which is good news. Perhaps Wales can offer surcharge discounts to encourage these behemoths to cover their vast roofs and carparks with solar panels.