Budget 2018: Cuts to small business rates 'welcome relief' but firms call for long term solution
PUBLISHED: 11:32 31 October 2018 | UPDATED: 17:17 31 October 2018
Islington business chiefs have welcomed the "much needed relief" after Philip Hammond slashed business rates for small firms in Monday's Budget.
Traders who pay £51,000 or less in ratable values, which is the rent for their business, will see their bills cut by a third over the next two years. The Chancellor says this could save businesses up to £8,000 per year.
The Islington Chamber of Commerce (ICC) launched a “save our shops” petition last week, urging the government to permanently increase the threshold for Small Business Rates Relief from £12,000 to £20,000 for inner London.
Hak Huseyin, who chairs the ICC, said: “Our petition has definitely been heard and the rate they pulled out with the (£51,000) is great because they will help businesses that are suffering.
“In the first instance it’s news for the independent businesses of Islington and much needed relief.
“For me this shows they have identified there is a problem, so what happens over the next two years is great but we are hoping they use the time to look at what is happening more generally.”
The ICC petition, which has so far gathered more than 500 signatures, also asked the Chancellor to make online businesses “pay their fair share”.
Hammond’s Budget promised a digital service tax, to be levied against online retailers earning £500 million or more, but it won’t be implemented before 2020.
The ICC plea came after the government hiked rateable values last year. Islington firms saw the third highest increase in England – and more than 200 businesses in the borough have closed over the past 18 months.
Hak added: “Retails hard, so long term they need to look at affordability and assisting businesses to be a part of this community and the local area.
“Moving forward the system they have needs to be fixed.”
Cllr Asima Shaikh, Islington’s economy boss, said: “The temporary reduction in rate bills is welcome, but it’s short-term.
“Without fundamental reform of the system, local firms will be at the mercy of the next Government revaluation in 2021, which is likely to see bills rise even further.
“At the very least, businesses need the government to make this discount permanent.”