Tesco, M&S and B&Q bosses call on Jeremy Hunt to freeze business rates to prevent high street closures

The chief executives at some of Britain’s biggest retailers have called on the Chancellor to freeze property taxes in order to prevent further high street closures.

The bosses at 44 retailers, including Tesco, Marks & Spencer and B&Q, have written to Jeremy Hunt and urged him to halt an inflation-based increase to business rates bills, the property tax on high street firms.

The letter, co-ordinated by the British Retail Consortium (BRC), said a rise would “threaten the viability of many shops and hinder the industry’s capacity to invest”.

The move comes in the wake of Wilko, one of the stalwarts of the high street, collapsing into administration last month after struggling with sharp losses and a cash shortage.

Business rates are planned to increase in April in line with the inflation figure for September.

The BRC said this would amount to an increase of more than £400m a year to retailers’ bills.

It highlighted that an increase at that level would also put more pressure on pricing in stores, as the Chancellor and Prime Minister seek to meet their pledge of halving inflation this year.

In the letter, they added: “Global supply chain issues are already likely to increase costs in the months ahead, including Russia’s withdrawal from the Black Sea grain initiative and targeting of Ukrainian grain silos, plus restrictions on Indian rice exports and ongoing labour market challenges.

“Against this backdrop, the Government should not make the situation worse by adding significantly to our cost base – freezing the business rates multiplier at its current level would avoid this.”

An inflation-linked rise to business rates would have been due to take place in April this year but was frozen by the Government.

Helen Dickinson, chief executive of the BRC, said: “The Chancellor must freeze rates to help keep a lid on retailers’ already high costs.

“While other business taxes, such as corporation tax and VAT, rise and fall with the movements in the economy, business rates must be paid in full whether firms are making a profit or a loss.

“This makes business rates the difference between retailers being forced to close existing stores rather than opening new ones.”

The first Wilko redundancies – 269 jobs at its support centre in Worksop and 14 others at a subsidiary firm – began last week.

Additional reporting by PA