London business rates to rise by £370m next April - here's why

 
Helen Cahill
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Warnings Given As April Business Rate Rise Threatens UK High Streets
Business rate changes came into effect at the beginning of April (Source: Getty)

London businesses are preparing for a £370m rise in business rates next year as soaring inflation pushes up tax bills.

The September rate of inflation will be used to calculate the revision of business rates in April.

Last week, the retail price inflation hit 3.9 per cent, pushing up the UK's total business rates bill by £1.15bn, according to analysis by rates experts CVS.

In London, the biggest rises will be in Westminster and the City of London, where the total bill will jump by £94m and £47m respectively.

Read more: Business rates to rise by £1bn in England due to rocketing inflation

Inner London boroughs will carry the largest share of the inflation-linked rise in rates, paying an extra £274m towards the capital's total business rates bill.

"Property taxes in Britain are already the highest of any European nation both as a percentage of GDP and overall taxation," said Mark Rigby, chief executive of CVS.

"Brexit is driving inflation and businesses are holding off from investing because of the current economic climate of uncertainty."

The rise comes after the government re-evaluated business rates this year. The rate rise was tied to changes in the rental price of properties, which meant London firms faced the most substantial tax increases. In some parts of central London, business rates jumped by more than 60 per cent.

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