Over 17,000 stores across the UK are at risk being closed over the next ten years unless the new government reforms the business rates levy, according to Sainsbury’s CEO Simon Roberts and Usdaw general secretary Paddy Lillis.
In an article for The Times, the pair warned that tens of thousands of retail jobs could vanish due to the steep rise in business rates.
They said: “The no 1 barrier to growth in our industry is the outmoded business rates system.”
“Successive governments have promised reform but have only ever tinkered around the edges. The result? Shops closing, jobs lost, economic growth stunted.”
Research from Development Economics found that 17,300 shops could shut by 2033-34 in the worst case scenario without action from the government on the levy, while roughly 42,000 jobs could be lost.
Meanwhile, a 20% drop in headline business rates would save retailers £1bn during the first year, while saving or creating over 17,000 new jobs.
While Development Economics said a rate reduction of this scale would initially lower tax sales for the Treasury, it claimed that after a decade, the corresponding rise in economic activity would create £70m of annual net positive returns for the government.
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The retail bosses added: “A government that revitalises growth, boosts jobs and secures long-term funding for public services will be able to look back on its achievements with pride.
“Reforming business rates won’t be a silver bullet to achieving all of this, but it would be a very good place to start.”
The comments come after Labour previously vowed to overhaul the business rates system if it won the election, in a bid to revitalise the high street.
The party pledged to replace the current system with a new one that would “level the playing field between the high street and online giants”.
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