BRC appoint EY for business rates review
The British Retail Consortium (BRC) has appointed accountancy firm EY (formerly known as Ernst & Young) to undertake a review of business rates across the country and better understand the impact that the tax has on High Streets.
Earlier in 2013 some members of the BRC, including Justin King of Sainsburys, called for an online sales tax to be levied on online retailers, to help High street shops. The government has since ruled out the introduction of such a tax.
The total taken in business rates will increase by £242m in April because of the 3.2% increase in the September RPI, which the government use to calculate the tax.
According to the BRC, for every pound retailers pay in corporation tax £3.44 is paid in business rates. This has increased dramatically since 2005 when it was £2.48. The BRC has already called for a cap on the annual increase to 2%.
And as this article in the Guardian highlights, parking charges may be the bogeyman but business rates are stifling growth. And there’s a petition to sign too.
If it is true high street retailers pay £3.44 in rates for every £1 of Corporation Tax, they clearly aren’t paying enough Corporation Tax. This kind of expenditure ratio isn’t recognisable to any small business, and strongly supports the argument that bigger companies need to pay a more socially responsible level of Corporation Tax compared with the low tax avoidance levels the current tax laws allow.