Business rates are inequitable and unrelated to business performance and unfairly hit high street businesses. Chairman of New West End Company (a leading London Business Improvement District), Sir Peter Rogers, has launched a proposal for interim and immediate business rates reform. In evidence to the Housing, Communities and Local Government Select Committee’s High Streets and Town Centres 2030 inquiry, Sir Peter argued that in the long-term business rates should be replaced by a revenue-based tax. In the interim, New West End Company is proposing that a revenue-based tax should be applied to the sales of purely online businesses, with the revenue used to reduce business rates. To read the proposal, click here and to see the research behind it, click here.
His proposal is that a 1% tax on the sales of online businesses (pure online businesses, not mixed online and bricks & mortar) would raise around £5bn each year and finance a 17.5% cut in business rates. The proposals are based on research commissioned by New West End Company from Arup and local government expert Professor Tony Travers, which highlighted the flaws in the business rate system and suggested alternative ways in which business can contribute to the funding of local government services.
The New West End Company has met with politicians, officials and interested trade and local government bodies in the run-up to the November budget to brief them on the proposals.
One of these meetings took place on Wednesday 17 October at the All Party Parliamentary Group for Town and Cities which focused on the need for immediate reform of the business rates system in response to the volatility on high streets across the country.
While acknowledging the difficulties in changing taxation systems, New West End Company believes an attempt should be made. Sir Peter Rogers says “If we do not act now we damage the ability of those businesses to survive and continue to drive our economy.”