Business rates are crippling for many small firms, particularly high street retailers with one Merseyside business leader calling the system ‘broken’ earlier this year. Tony McDonough reports
Merseyside Labour MP and Shadow International Trade Minister Bill Esterson has unveiled a series of measure he claims will “radically reform the business rates system” with statutory annual revaluations.
Business rates are crippling for many small firms, particularly high street retailers with one Merseyside business leader calling the system “broken”.
A long-awaited revaluation earlier this year was supposed to alleviate the burden and lower bills. However, because reductions are phased in over five years many businesses are still paying too much.
This month, the British Retail Consortium said firms could be paying £1bn extra in business rates over the coming year.
In a speech to the Association of Convenience Stores annual conference, Mr Esterson, the MP for Sefton Central, promised to “guarantee a fair and transparent appeals process, bring forward CPI indexation and exclude new investment in plant and machinery from future business rates valuations”.
The MP said revaluations would take place every year, avoiding the recent scenario where firms where paying rates based on values prior to the financial crash.
He also said a Labour Government would “wage war on late payments by using Government procurement to ensure that anyone bidding for a Government contract pays its own suppliers within 30 days”.
Mr Esterson told the audience: “Not only has the Government failed small businesses in regard to business rates, they failed to handle the scourge of late payments which, as you will all know, means small businesses struggle to cover costs, invest and may even go bust.
“Two and a half million businesses are affected by late payment and 50,000 businesses are estimated to go out of business every year because of late payment.
“It is the number one challenge faced by SMEs – as late payment presents major cash flow headaches for firms.”