Business rates are in for the biggest rise in six years as inflation increases.
Tax bills for next year could increase by as much as £1.2bn as interest rates flirt with 4 per cent, CVS Business Rent and Rate Specialists warned today.
The retail sector alone is likely to face a £301.69m increase next year.
The Uniform Business Rate multiplier, which determines how much businesses pay, is uprated annually in line with the Retail Prices Index (RPI). The RPI has increased rapidly from 2 per cent last September to 3.7 per cent in May.
The government promised in the last budget to instead base the calculation on the lower consumer price index (CPI) measure, but implementation is not planned until 2020.
Mark Rigby, chief executive of CVS, said: "When I met with the Secretary of State, Sajid Javid, ahead of the budget, I urged him to accelerate the switch from RPI to CPI and to implement that change from April this year."
But the absence of any mention of a business rates review from the Queen's Speech last week suggested that the reforming process has been shelved as a lesser priority.
With retail volumes down 1.2 per cent in May, the outlook for retailers looks gloomy according to CVS.
Rigby added: "Increases to business rates bills next year, at the level reported for May or higher, could lead to a tsunami of store closures."