Retail: renewed calls for more business rates relief following Chancellor's latest support package

Chancellor Rishi Sunak's latest package of support does not go far enough to support retail as it faces a bleak winter of low footfall following calls for the nation to work from home for the next six months, industry figures have said.

Sunak announced a package of measures today (see below) to replace the outgoing furlough scheme to help support businesses over the winter. However retail and property leaders reiterated their call for the current business rates holiday, which runs until next April, to be extended to prevent retailers being destabilised by large bills as they try to get back on their feet.

Tom Ironside, director of business and regulation at the British Retail Consortium, said the new jobs programme, where the Government will pay to top up wages to enable part-time working, will “help reduce job losses” at eligible firms but joined others in calling for the rates holiday to be extended.

Other trade groups, such as UKHospitality, had also been called for an extension to the business rates holiday for hospitality and retail firms for the 2021-22 financial year, before the Chancellor’s speech.

Ironside said: “Retail is on a delicate path to recovery, but the looming threat to this remains the £8 billion business rates cliff-edge from April 2021.

“Retailers need certainty and the Chancellor must take action and bring down the business rates burden in order to avoid unnecessary job losses and shop closures.”

Robert Hayton, head of property tax at real estate adviser Altus Group, added: “Today’s statement was a missed opportunity to deliver discerning targeted support to help with business rates bills from next April. 358,264 retail, leisure and hospitality premises will be returned to full business rates during 2021/22 after having had a £10.13bn rates holiday in England this financial year. This could create a cliff edge.”

In Brief: The support measures announced by the Chancellor today

– The Jobs Support Scheme (JSS), a form of wage subsidy for “viable” jobs, will replace the furlough scheme, which will be wound down next month.

– The JSS will allow staff to be paid by their employer for working at least a third of their usual hours, with the Government topping up the remaining two-thirds of their salary that would have otherwise been lost due to working reduced hours.

– All small and medium-sized businesses will be eligible for the wage support concept, which starts in November and runs for six months, but larger businesses will have to prove their profits have been hit by the pandemic.

– The current self-employed grant will be renewed on similar terms to the new Jobs Support Scheme, the Chancellor said.

– The temporary reduction of VAT rates from 20% to 5% for the hospitality and tourism sectors will be extended for a further two months, with a new deadline of March 31 2021.

– Business “bounce-back loans” will have a “pay-as-you-grow” element added, giving loanees 10 years rather than six years to repay the money, a move that will slash monthly repayments by almost half, according to the Chancellor.

– Those struggling to repay their bounce-back loans will be able to choose to make interest-only payments and “anyone in real trouble” will be permitted to suspend repayments all together for up to six months, said Mr Sunak.

– The deadline for taking out a coronavirus business interruption loan will be extended until November 30, with Mr Sunak also increasing the Government guarantee on them for up to 10 years.