Retailers have urged the chancellor to keep promise on business rates relief

The call comes after new analysis by real estate intelligence firm Altus Group that shows more than 252,000 shops and businesses could be hit by a potential £2.7bn tax hike, as first reported by The Guardian.

The looming tax increase is likely to mainly hit smaller retail, leisure and hospitality businesses from April next year when the 75% relief up to a cap of £110,000 ends, according to the research.

Altus Group’s analysis found all sectors will share a £545m increase in the tax based on the consumer prices index measure of inflation and £250m of that total will fall to retail, leisure and hospitality.

British Independent Retailers Association chief executive Andrew Goodacre told the newspaper: “The chancellor has the power to extend the retail, hospitality and leisure relief, which is absolutely vital if high streets are to be revitalised and grow.

“We urge the government to consider this crucial support for the retail sector.”

President of property tax at Altus Group Alex Probyn added: “Despite the £22bn ‘black hole’ in the nation’s public finances, the chancellor must now prevent a cliff edge for the retail, hospitality and leisure sectors at her upcoming budget while also delivering upon Labour’s manifesto commitment to lower the undue burden already placed on our high streets.”

The intervention follows an open letter coordinated by the British Retail Consortium, signed by more than 70 retail leaders, which was sent to the government last week ahead of the budget saying “now is the time to level the playing field between industries”.

Retail bosses said the current business rates burden “holds back investment in people and places – directly affecting the 3 million people employed by the industry and the 2.7 million additional people employed within the supply chain”.

The letter also said UK high streets and town centres are “paying far more than their fair share of tax” in comparison to other sectors.