Autumn Statement 2023: Groups warn business rates increase would be 'disastrous'

Five hospitality, retail and leisure organisations have written to chancellor Jeremy Hunt urging him to freeze the business rates multiplier and extend existing reliefs for another year in the Autumn Statement on 22 November.

In the letter (see below), UKHospitality, British Retail Consortium, Association of Convenience Stores, British Independent Retail Association and ukactive warn that businesses, jobs and the future of high streets are at risk without the measures.

In last year's Autumn Statement, the chancellor increased business rates relief for retail, hospitality and leisure firms from 50% to 75% for 2023-24, up to £110,000 per business. He also froze business rates multipliers at 49.9p and 51.2p.

The groups call for the relief to be extended for a further 12 months and the cap to be extended to at least £2m per business. They also say the business rates multiplier freeze should be maintained.

According to UKHospitality, an inflation-linked increase to the multiplier would cost retail businesses £480m and hospitality businesses £234m, while an end to the current relief would cost hospitality £630m and retail £750m.

In a survey of British Retail Consortium members, 66% said they were 'very concerned' about an increase in businesses rates, with 69% admitting it would place 'significant pressure' on the prices paid by customers.

The letter is the latest of several calls on the chancellor to not increase business rates. Enterprise Nation has also urged him to maintain current rates and relief.

New official figures released on Friday show that retail sales in October hit the lowest level since the 2021 coronavirus lockdowns.

Enterprise Nation will have an online panel reacting live to the chancellor's Autumn Statement speech from 12.30pm on 22 November.

The letter in full

Dear Chancellor, Secretary of State,

We write to you as the face of the high street, businesses that bring people together and contribute to the nation's physical and mental health. Collectively, we are an economic powerhouse, representing over 6 million employees across the hospitality, leisure and retail sectors.

At your Autumn Statement last year, you set out a generous package of business rates support recognising the economic damage wreaked by the energy crisis and inflationary costs through the economy. You correctly identified the specific burden of rates on our sectors with the extension of, and increase in, the Retail, Hospitality and Leisure (RHL) Relief, as well as freezing the business rates multiplier.

One year on, the success of these measures is shown by the resilience of businesses in our sectors, despite intense pressure. However, these pressures continue. Energy prices remain at historically high levels, we have seen soaring wage costs (in our labour-intensive sectors) and our input costs remain high. For many businesses in hospitality, leisure and retail, the crisis is far from over.

We therefore collectively urge you to continue your business rates support -- prioritising a freeze in the multiplier, extension of the RHL Relief for a further year at 75% and an increase in the relief's cap to at least £2 million per business.

By providing this critical business assistance you will allow us to continue to provide our much-loved services to our communities, invest in our high streets and continue to employ millions of people in every part of the country.

An inflationary increase in the business rates multiplier and removal of reliefs would be disastrous for our sectors. It will mean business failures, job losses and boarded up properties in our high streets, denying people their livelihoods and their social pleasures.

We are optimistic sectors that know we can play an important part in people's lives.

We want to grow, we want to constrain costs and we want to contribute to society -- action at the Autumn Statement on business rates is needed for us to deliver on these mutual objectives.

We would welcome a meeting to discuss this further and look forward to seeing positive action in your Autumn Statement.

Yours sincerely,

• Kate Nicholls, CEO, UKHospitality

• Helen Dickinson, CEO, British Retail Consortium

• Huw Edwards, CEO, UK Active

• James Lowman, chief executive, Association of Convenience Stores

• Andrew Goodacre, CEO, British Independent Retailers Association