Andy Burnham’s proposed rates reforms could help cut business rates for over 100,000 small businesses but could cost £880m a year, new analysis suggests.
Burnham, who will likely be the next Prime Minister, has promised to reform business rates to help high streets, insisting there's scope for ‘room for movement on tax’ while sticking to Labour's fiscal rules.
His central proposal, first floated during the Makerfield by-election, would raise the threshold for full Small Business Rates Relief from £12,000 to £18,000, with taper relief extended to £21,000.
Analysis from tax firm Ryan suggests this could remove over 140,000 small premises from business rates entirely, cutting liabilities by roughly £880m annually.
Burnham wants the cost met by taxing large warehouses and ‘online giants’ more heavily. But Ryan's Alex Probyn cautioned that the existing surtax mechanism – already able to rise from 2.8p to 10p – hits far more than warehouses, covering offices, data centres and airports too. He warned this risks raising costs across sectors that drive investment and jobs.
Check out: Fiscal Devolution – has stuff just got real?
