Cut rates to save shops, say Sainsbury's and retail union

The boss of Sainsbury’s has said the business rates tax system is “no longer fit for purpose” and warned that current planned increases will lead to thousands of high street closures and job losses.

- HENRY SAKER-CLARK

Business rates are the property tax system for businesses, affecting sectors including retail, hospitality and leisure. Sainsbury’s and Usdaw (the union representing shop workers) have called for increases to be suspended and the overall rates payments from retail to be cut by 20 per cent.

They said research, carried out by Development Economics, found continued increases based on the current direction of inflation would drive profitable shops into loss, and mean “an estimated 17,300 closures by 2033-34”. The study also found that over the course of the decade the government would lose almost £5.5bn in tax revenues linked to closures.