UKHospitality, the UK’s leading trade association for the hospitality sector, has backed calls for action to be taken on business rates.
A recent Commons report found that the current business rate system is “unfair”, with the rates favouring online retailers.
The report found that the rates were growing as a proportion of the tax paid by businesses while outpacing inflation. A Treasury committee advised that the new Government should examine alternatives in preparation for the spring statement, following the upcoming general election.
The report also stated that “improvements could be made” in the meantime, including reducing the statutory limits for responding to appeals, ensuring the Valuation Office is properly resourced, and improving the reliefs that are available.
Kate Nicholls, Chief Executive of UKHospitality, said: “We’re pleased to see the committee recognising the burden of business rates has grown and the system no longer works. The current system is nowhere near flexible enough and it has directly contributed to the decline of high streets.
“Hospitality businesses are at a particular disadvantage and have been arguably hammered worse than any other sector. The current system penalises businesses who invest in their properties and actually acts as a deterrent to investment. We need a complete rethink of the system and an overhaul to bring it in line with the 21st century.
“We are pleased that policy-makers are listening to the concerns of businesses and acknowledging that there must now be action. There must be, as the committee recommends, a consultation at the soonest opportunity to identify alternatives to the current system.
“The incoming Government must act on this as a priority. We will be keeping up the pressure with recommendations to ensure fairness for hospitality.”