Business rates reform needed

MPs on the BIS Business Select Committee have called on the Government to make radical reforms to the business rates system in order to help retailers and local economies. The MPs argue in a report that the tax is no longer fit for purpose and that there should be an examination of whether retail taxes should instead be based on the value of sales. The report also suggests a separate system of business taxation for the retail sector. Adrian Bailey, the committee’s chairman, said: “Since the system was created, the retail environment has changed beyond all recognition. A system of business taxation based on physical property is simply no longer appropriate in an increasingly online retail world.” The British Retail Consortium and Bill Grimsey both welcomed the report. The BRC’s director-general Helen Dickinson commented: “This report must be the final nail in the coffin of the question: Do business rates need to be reformed? They do. Business thinks so. A committee of Parliament thinks so. We very much hope the government will think so too.” Mr Grimsey added: “How many more reports like this do we need before ministers finally wake up to the problems they’re storing up by continuing with a system that’s simply not fit for purpose?” Financial Times, Page: 2