‘No comfort’ for retailers in ‘missed opportunity’ Budget

Despite being a key part of the Conservatives’ 2019 manifesto, chancellor Jeremy Hunt failed to address retail’s longstanding bugbear of business rates and said nothing about freezing the rates multiplier in 2024/25.

British Retail Consortium chief executive Helen Dickinson said: “While the autumn Budget brought in some welcome changes to the business rates system, further reform is needed. The broken business rates system remains a drag on investment, jobs and economic growth.

“Rates must be paid in full whether firms are making a profit or a loss. This makes business rates the final nail in the coffin for many struggling stores; shutting shops, costing jobs and preventing new store openings. The chancellor should make good on the Conservatives’ 2019 pledge to reform rates and lay out a clear roadmap for future reforms.”

Retailers were disappointed at the lack of a mention of a new tax-free shopping scheme for international tourists.

Chief executive of the Knightsbridge and King’s Road partnerships Steven Medway said: “Retail and hospitality mired by uncertainty will take no comfort in the chancellor’s spring Budget today, which promised confidence but inspired little cause for optimism.

“VAT-free shopping and its reinstatement in policy is a missed opportunity to reassert Britain’s pre-eminent status as the international destination of choice for retail after a perfect storm of practical challenges.

“We risk losing our crown to European competition with more favourable tax regimes such as Paris and Milan, so long as we knowingly tie both hands behind our backs.”

While Hunt unveiled a three-month extension to the energy price cap for households, the lack of a similar scheme for business was criticised. The Association of Convenience Stores said this failure to act “will hurt communities, threaten jobs and cost the Treasury millions”.

The Federation of Independent Retailers said the Budget failed to address a “number of factors that are threatening the very existence of many small retail businesses” – citing a lack of support on energy bills and tax hikes on alcohol and tobacco.

The BRC also said the chancellor “missed a key opportunity” to fix issues with the apprenticeship levy system to support his stated goal of getting more people into the UK workforce.

“To break this cycle of wasted investment, it is vital the government allows businesses to use their hard-earned levy funds for a wider array of skills courses,” said Dickinson. “Without spending a penny, the chancellor would increase investment in our workforce, helping businesses to prepare the UK economy for the skills it needs.”