In an open letter coordinated by the British Retail Consortium (BRC) to Reeves, 71 retail CEOs have called for the Labour government to introduce a Retail Rates Corrector.
The corrector would decrease the business rates paid on retail properties by 20%. This aims to address the imbalance where the retail industry pays 7.4% (£33bn) of all business taxes compared to its share of 5% GDP in the economy, the BRC said. One fifth of the £33bn is business rates, which is the highest paid out of all business sectors.
Signatories include M&S’s CEO Stuart Machin, AllSaints’ Peter Wood, Asos’s José Antonio Calamonte, Matalan’s Jo Whitfield, Monsoon’s Nick Stowe, New Look’s Helen Connolly, Bravissimo’s Leanne Cahill, Oliver Bonas’ Oliver Tress, Schuh’s Colin Temple and Go Outdoors’ Lee Bagnall, among others.
The corrector also aims slow down shop closures and unlock new investment in jobs, shops and communities.
Chief executive of BRC Helen Dickinson said: “Retail has been the golden goose, generating tax revenues far beyond the industry’s size, but the current situation is not sustainable. The government should act to rebalance the system and ensure all industries are paying their fair share. This in turn would drive increased retail investment in people, places and communities.
“The Budget is the perfect opportunity to lay the groundwork for local investment that delivers for retail’s customers, delivers for its employees, and delivers for the economy.”
The Labour government’s manifesto pledges replacing the current business rates system with one that “raises the same revenue but in a fairer way”. It intends to level the playing field between high streets and online operators and tackle empty properties. But it has not been made clear what the system will be.
Fashion retailers have been calling for business rates reform for many years. In Drapers Fashion Retail Manifesto on behalf of the fashion retail industry, most businesses emphasised the importance of lowering business rates. The increase in business rates multiplier to 54.6p from April 2025 is set to come at a cost of roughly £470m to the industry.