Mike Ashley’s Frasers Group adds name to business rates letter
Mike Ashley’s Frasers Group has added its name to a list of 52 retailers calling on the Government to take urgent action on business rates.
The company, which is the parent of Sports Direct, House of Fraser and Flannels among others, said the “transitional relief” rules were particularly onerous and demanded a complete overhaul.
Transitional relief is supposed to help businesses not be overburdened with their rates bills soaring following a revaluation of the amount due.
Limits are in place to help those who are underpaying stagger the upwards transition to a higher bill, funded by overpayers slowing the speed at which their lower bill is introduced. But retailers are angry that lower bills are not cut quicker, due to the transition.
Frasers said: “Transitional relief in particular is disastrous for a great many retailers and needs to be significantly modified to at least ensure the correct amount of rates are paid by the end of transitional relief periods.
“The current system whereby downward transitions of just a few per cent a year means that the correct amount is never reached, or even close to, punishes those in greatest need of relief.”
Ashley’s business added some stores pay up to four times the rates bills they should be.
“This kind of pattern clearly cannot be right and is no doubt repeated widely across UK retail; it is a significant contributor to the dire straits the high street currently finds itself in,” the company added.
The comments come as 52 retailers, including Marks & Spencer, Harvey Nichols and Ann Summers, among others, said transitional relief has seen the industry forced to subsidise others to the tune of £543 million over the last three years.
However, the letter was sent to Sajid Javid in his role as Chancellor – which he quit on Thursday. He was replaced by Rishi Sunak, who will be in charge of delivering next month's budget.
Helen Dickinson, chief executive of the British Retail Consortium, which organised the letter, said: “It is essential our new Chancellor makes good on the Government’s pledge to reform this broken system.
“Swift action at the upcoming Budget would show the Chancellor was serious about levelling up all parts of the UK and supporting a retail industry towards realising a brighter future.”