Business rates review on Budget agenda

The Treasury will today launch a review of business rates, raising the prospect of a new system for levying a tax paid by 1.8m properties in England. Danny Alexander, Treasury chief secretary, will consider a move away from a tax based on property values, seen as a burden on high street traders that face intense online competition, ahead of this week's Budget. The Chancellor will use his Budget on Wednesday to announce a wide-ranging review of the business rates system. The review is expected to examine whether business rates could in future be raised in line with the consumer prices index measure of inflation, rather than the retail prices index. The idea of taking small firms out of the rates system altogether has been mooted, and it is noted that small firms represent half of all commercial properties but yield only 6% of the tax. The BCC and the CBI both welcomed news of a review but urged for any reform to be “root and branch”.