In the week before his first Budget, the Federation of Small Businesses (FSB) continues to lobby Chancellor Philip Hammond on the controversial issue of business rates.
The FSB has released a survey, which found that 36% of small firms expect to see their business rates increase when the re-evaluated rates come into effect from 1 April. Of those, 44% of FSB members say that their business rates will eventually rise by more than £1,000 per annum, while 21% will see their annual bill increase by more than 40%.
According to the FSB, the business rates rise could have significant consequences for the growth of affected small businesses. It has claimed that a ‘significant proportion of small businesses across Britain are preparing to reduce investment and staff costs once business rates rise’. 54% of firms facing a rise expect profits to fall, while 55% plan to reduce, postpone or cancel investment in their business, the survey revealed.
Mike Cherry, National Chairman of the FSB, said: ‘The business rates system is an unfair, regressive tax which hits small firms before they’ve had the chance to make their first £1 in turnover, let alone profit. Our survey shows the delayed revaluation harms too many small businesses who face unsustainable and unaffordable rises.
‘The solution is for the Chancellor to use his Spring Budget to announce a cross-party commission to propose measures for a replacement business tax system linked fairly to the ability to pay.’
The Chancellor will present the 2017 Spring Budget on Wednesday 8 March. We will be keeping you up-to-date on the key announcements, so please visit our website regularly.