Thousands of squeezed London businesses are now facing a “ticking time bomb” in the form of coming tax hikes, London Mayor Sadiq Khan has warned.
Khan revealed to City A.M. last night that business rates will increase in 28 of the capital’s 32 boroughs in 2023, just as the UK is predicted to go into recession.
The government intervened this month to stagger planned business rates increases for next year over three years, however many London firms are still facing crippling hikes.
Khan is calling for the government to more than double the rateable value threshold at which SMEs start paying the tax.
“We need an urgent package of measures from government to support small businesses and those in the outer London boroughs who are fighting to survive in this tough economic climate,” he said.
Figures released by City Hall revealed that some London SMEs are facing 24 per cent rises in their firm’s rateable value, rates are partly based on property values, from April.
Nick Bowes, chief executive of the Centre for London think tank, told City A.M.: “Planned hikes in business rates risk tipping London businesses over the edge.”
Some of the capital’s iconic sporting venues will suffer huge hikes.
The All England Lawn Tennis Club in Wimbledon will see its bill climb 75 per cent over the next three years, while Crystal Palace Football Club will have to pay 60 per cent more in business rates on its Selhurst Park stadium over the next two years.
Chancellor Jeremy Hunt provided some relief in the autumn statement earlier this month by freezing the figure councils multiply to calculate business rates bills for another year.
A treasury spokesperson said: ”As well as ongoing help this winter with energy bills, we announced a generous £13.6 billion business rates support package at autumn statement, which includes full protection from inflation for all, more relief for high streets and systematic-changes so the full benefit of lower bills can be felt straight away.”
“This comes on top of the business rates review which concluded last year and committed to more frequent revaluations, and together means that every region will see a cut to their average bill.”