What else did the chancellor announce this week?
While there was no fundamental restructuring of business rates that most retailers would have loved to have seen, there were some tweaks and amendments that might have short term benefits for them.
There was a temporary 50% discount on business rates, capped at £110,000 and for one year only for high street shops, pubs and restaurants alongside a pledge to make the system fairer by having more frequent revaluations taking place every three years.
The raise in business rates caused by the multiplier scheduled for next year was also cancelled.
Investment relief would also be available on green initiatives such as installing solar panels and improvement relief offered for 12 months following the enhancement of retail business premises.
The chancellor also announced a consultation on an online sales tax that would replace income lost from rates reform as part of a wider reorganization.
Helen Dickinson, chief executive of the British Retail Consortium which represents retailers was unimpressed.
She said: “The Chancellor spoke of a new age of optimism but retailers will struggle to share his confidence after a budget that does not do enough to reduce the burden of costs bearing down on our shops, our high streets and our communities.
“With firms still stuck on property valuations from 2015, the move to a three-year revaluation cycle, supported by a properly funded Valuation Office Agency, is welcome and is a clear acknowledgement that rates have fallen well out of kilter with the wider property market.
“The freeze in the multiplier is positive, though the evidence is clear that the current rate – over 50% in England – is already far too high.
“This budget is a missed opportunity for retail and the three million people who work in the industry, and it prevents retail from maximising its contribution to the government’s levelling up agenda.
“With no reduction in the rates burden, this will lead to the unnecessary loss of shops and jobs and fails to incentivise investment.”
Shevaun Haviland, Director General of the British Chambers of Commerce, said: “Businesses have been battered by 18 months of the pandemic and problems around supply chain costs and disruption, labour shortages, price rises, soaring energy bills and taxes, and there may still be difficult months ahead.”
Struggling to pay VAT arrears? We can help
Chris Horner, Insolvency Director with BusinessRescueExpert.co.uk, said: “Despite business rates being suspended for 15 months for the retail, hospitality and leisure sectors from March 2020 before returning in June, they are still seen by many as an intractable problem.
“Those hoping for a revolution rather than evolution will be left disappointed by the budget although a 50% discount, albeit temporary, is better than none at all. The move to a three year cycle of revaluation will also benefit retailers with a physical store presence.
“For businesses already struggling with their outgoings, budgets rarely provide a magic bullet that will solve all their problems.
“The closest thing to that is arranging to speak to a professional and expert advisor who can assess their situation holistically and recommend an effective and efficient strategy for them and their business.”
Help is there is businesses need it
Once we can get a clearer picture of their unique circumstances and situation, we can work with them to piece together a pathway back to profitability for them to follow if there is a viable way for them to turn their company’s fortunes around.
If the debts or other problems are insurmountable then we can advise on other strategies they can follow including liquidation that will allow them to close quickly and with a minimum of fuss and stress – which will allow them to begin again with a clean slate sooner than they might think.
Whatever their intentions or wishes – taking the first step and getting in touch soon will be the most important choice they make.