Small firms on England’s embattled high streets are set to share in half a billion pounds worth of tax cuts as business rates bills are slashed, real estate adviser Altus Group has said.
The government announced a business rates discount scheme for small sized high street properties in England which have a rateable value below £51,000 at the 2018 Autumn Budget last October.
Under the scheme, small firms will receive a third discount from rates bills from today for the next two years which Philip Hammond said would help “up to 90% of all independent shops, pubs, restaurants and cafes.”
According to Altus Group, the average shop will see savings of £3,292 in business rates bills for 2019/20 whilst the average pub will save £6,052 and the average restaurant will receive a discount of £7,212. Councils in England are expected to set aside £502m this financial year to cover the cost.
Robert Hayton, head of UK business rates at Altus Group, said it was “imperative” that small firms checked their new tax demands carefully saying “some councils are insisting that firms apply for the discount rather than applying it automatically.”
But Hayton said it “wasn’t all good news” as councils in England are still expected to collect £25bn in business rates during 2019/20, which is an increase of £206m. This is because the standard rate of tax is above 50% for all medium to large sized premises across all sectors of the economy – the highest rate since the national business rates system was introduced in 1990.