The signs are not good as the Chancellor of the Exchequer warns of the dire state of the UK’s finances and the likelihood that taxes will have to rise to repair them.
One thing that will be of particular interest to businesses is what will happen to business rates.
The Government published the findings of its latest consultation on business rates in October 2021 and among the key announcements were that:
Business rates will go up in line with inflation from April 2023, which could mean a rise of 10%.
There will be a 50% discount for small retail, hospitality and leisure businesses in 2022-23 up to a maximum of £110,000. This is due to expire on April 1 2023.
Revaluations will now take place every three years, rather than every five years starting from the April 2023 revaluation.
The CBI (Confederation of British Industry) has already called for the Government to reconsider the planned April 2023 rise and for ‘urgent reforms’ to the business rates system and to the ‘inflexible’ Apprenticeship Levy’.
Businesses in the retail sector, among them Greggs, Tesco, Sainsbury’s and Iceland, have also called for rates to be frozen in view of escalating energy prices and inflation, which are hitting their customers, and therefore sales, hard.
According to Altus Group, British firms are facing a near £3bn annual hike in business rates in April if inflation stays above 10%.
It remains to be seen what Jeremy Hunt announces on Thursday, but it’s not looking good. Meanwhile to help you stay on top of your finances why not download K2’s free cash management tool here.