The Government’s Business Rates Retail Relief scheme was unveiled in the budget in October last year, but was overshadowed by Brexit talks.
The policy goes to Full Council tonight [Wednesday] at Tunbridge Wells Borough Council, and since the money for the rate relief comes direct from central government, councillors are expected to approve the plans, which will see its introduction on April 1st.
The relief will see business rates cut by a third for struggling retailers whose business has a rateable value below £51,000.
This makes for quite a sizeable discount. According to council figures, a business with a rateable value of £40,000 would be eligible for a discount of more than £6,500, reducing the tax burden from £19,640 to £13,093.
The business rate discount will also be applied after other mandatory and discretionary reliefs, such as the Small Business Rate Relief, which is open to all small businesses, not just retailers, but has a much lower rateable threshold.
Business rates have been cited by a number of struggling retailers as a serious concern, and have even been blamed them as a cause for putting some shops out of business.
Only in recent weeks, the Times has reported on a number of retail closures including Fromage & French, a popular independent delicatessen, whose owner Gaelle Coyle put down ‘exorbitant’ and ‘crippling’ business rates as among the main reasons for shutting up shop.
“This is definitely welcome news,” she told the Times.
“It is too late for me but if it had come in earlier, it could have made quite a difference, but I suppose it is better late than never.”
Ms Coyle said her business rates amounted to around £800 a month, so the discount of £266, would have ‘eased pressures’.
“I’m not sure it would have been enough to keep me going – there were other factors – but it would have made a difference, certainly, and I can see it being welcomed by a lot of businesses in the town.”
And only last week, Oddbins in Mount Pleasant Road closed down after the off licence chain went into administration earlier this month, with administrators Duff & Phelps citing rising business rates as among the causes of the wine retailers’ collapse.
The retail rate relief is set to benefit many types of business including shops, restaurants, cafes and drinking establishments, but financial services, estate agents and employment agencies will not qualify.
Councillor David Reilly, Finance & Governance portfolio holder for TWBC said: “This Council recognises the importance of retail businesses to our local economy. It is therefore good news that the Government has provided an injection of much needed short term relief for retailers who are struggling to meet the new challenges brought about by unprecedented changes in shopping habits and the retail landscape.
“We will do our bit by ensuring that the measures announced in the Budget are approved by the Council.
“Going forward it is important that the Government continues to allocate long term funding for the revitalisation of town centres and that councils, with their important place-shaping roles.”