Business Rates Cut Could ‘Revitalise’ Town Centres

Chain stores are closing at their slowest rate for eight years, new research shows.

Business leaders and traders in Norfolk are urging the next government to cut business rates to help revitalise high streets. Jonathan Newman, Great Yarmouth town centre manager, noted that the current level of taxes is “discouraging investment.”

Labour has proposed overhauling the rates system to “level the playing field” for town centres competing against online retailers. The Conservatives, on the other hand, promise a “business rates support package” and £20m each to 30 towns as part of their levelling-up policy if re-elected.

Great Yarmouth has already benefitted from government funding, including £5.2m for a market building and an additional £5.8m promised last month for improvements around it. Additionally, most of the £17m redevelopment of the former Palmers department store was funded by Whitehall.

Despite these investments, Newman highlighted the adverse impact of the cost of living crisis, high interest rates, and the broader economic situation on retail in town and city centres. He called for more action, particularly in addressing business rates, which he said are discouraging investment in town centres.

Nick Spencer, manager of Market Gates Shopping Centre, also pointed out the unfair advantage lower rates give to out-of-town retail parks. “If they want to make town centres viable and come back to life, the government needs to take it seriously,” he said.

Candy Richards, development manager for the Federation of Small Businesses in East Anglia, echoed the call for a rates cut, stating that business rates can be a significant disincentive for small businesses on the High Street.

Business rates are a tax on properties used for commercial purposes, charged based on the property’s estimated rental value on the open market, known as the “rateable value.”

In their manifesto, the Conservatives have pledged a £4.3bn business rates support package over the next five years to support small businesses and high streets. Labour has proposed changing the rates system to allow bricks-and-mortar businesses to better compete with online giants. Meanwhile, the Liberal Democrats have suggested abolishing business rates altogether and making landlords pay a levy on their buildings.

Andrew Baker, a hairdresser in Swaffham, emphasized that “taxes and rates” are the main issues for traders, suggesting that a change in the system could help attract new businesses. He believes that a rent review could allow smaller businesses to flourish by retaining more profit, which could then be redistributed locally.

Swaffham has also benefited from government funding, receiving £380,000 in High Street Heritage Action Zone funding. However, Julie Foley from tobacconist and vape shop Puff ‘N’ Stuff, expressed concerns over declining footfall, with shoppers preferring larger towns or online shopping. “Without the footfall, none of the shops can survive,” she said, highlighting the challenges faced by local businesses in maintaining their customer base amidst the growing online retail trend.