Sunday 18 August 2019 3:27 pm

Retailers ramp up challenges to business rates as high street woes deepen

The number of businesses challenging their rates bill has soared over the last quarter as retailers continue to feel the squeeze from tough conditions on the high street.

Roughly 4,000 challenges were made in the first quarter this year, a 65 per cent increase on the previous three months, according to figures from City law firm RPC.

Read more: Vacancy rates hit worst level in over four years

The number of challenges has risen rapidly over recent months, with business owners filing a total of 12,390 disputes to the Valuation Office Agency since April 2017.

The figures highlight growing discontent about business rates, which are calculated based on property values and a multiplier that rises with inflation.

“The sharp jump in challenges shows that the burden of business rates is causing more and more pain for retailers on the high street,” said Jeremy Drew, co-head of retail at RPC.

The British Retail Consortium last week wrote to chancellor Sajid Javid urging the government to freeze business rate increases.

More than 50 high street retailers signed the letter, which said business rates often represented a “tipping point” that led to a store’s closure.

Drew added: “The government needs to go further than it did last autumn when business rates were reduced for only the smallest of retailers. 

“The retail sector’s view is that the changes made just tinkered around the edges and made the business rates regime even more complex.”

One policy area highlighted by the report was relief rates for empty properties, which RPC said could be ripe for reform.

Prior to 2008, businesses were granted 50 per cent relief on rates if their property was vacant for longer than three months, and some retailers have called for this policy to be reintroduced.

Read more: Restaurants eat into retailers’ high street share

In addition to business rates, retailers have also been hit by rising staff costs and a decline in footfall prompted by tough competition from ecommerce rivals.

The tough conditions have wreaked havoc on the British high street, with a spate of recent closures causing vacancy rates to hit a four-year high last month.

Main image credit: Getty