Chris Mahony 21 February 2019

MPs pile pressure on Government over business rates reform

MPs have urged ministers to assess specific proposals for reforming business rates by the autumn.

In a report published today, the Housing, Communities and Local Government Committee said correcting the imbalance in business rates paid by online and high street retailers was crucial to ‘securing the future of the high street and the retailers which will always be an important part of it’.

The committee urged the Government to assess proposals including a ratings methodology for the warehouses of online retailers and replacing business rates for retailers with a sales tax or rise in VAT.

Chair of the Local Government Association’s resources board, Cllr Richard Watts, said: ‘As the way we shop is changing, we agree with the committee that the business rates system needs to be modernised to ensure that sectors such as online businesses make a fair contribution.’

More widely, the MPs put local government at the centre of reviving high streets and town centres.

However, given the financial pressures they face and cuts to planning and other relevant departments, the report said councils would need significant financial backing from central government.

High streets minister Jake Berry said: 'We know high streets are the backbone of our economy and a crucial part of our local communities, and we want to see them thrive – both now and in the future.

'That’s why the Government has stepped up, putting a plan for the high street at the centre of the Budget backed by £675m cash investment to ensure that local high streets are able to adapt and thrive for generations to come and establishing a High Streets Task Force to support local leadership.

'As the chancellor made clear in the Budget, an online sales tax would be passed onto consumers.'

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