High street dealers will be scrutinising the small print of the plans announced by The Chancellor in the Budget...
around the easing of business rates. The plans to try to support small retailers comes in the shape of £900m in business rate relief and £650m to breathe life back into high streets and the transport links that serve them. Hammond said that the high street was facing major challenges, thanks largely because of online competition and it needed help now ahead of rate value revisions coming in 2020. "If Britain's high streets are to remain at the centre of our community life they will need to adapt," he said. "The change that our high streets face is irreversible and it will take them time to adapt but many small businesses are facing it difficult to cope with high street business rates," he added that it would be giving all retailers with a ratable value of £51,000 or less the business value would be cut by a third, saving up to £8,000 annually for the next two years for most businesses. Hammond said that the era of austerity was coming to an end and the economy was showing signs of robustness with eight years of growth, unemployment down and wages rising, "an economy back on its feet again". He also talked about "managing change, not hiding from it" and encouraging greater recognition of the increasing importance of technology, with £1.6m of investments in tech, and tackling the skills crisis. "I want Britain to be one of the great winners of the technological revolution," he added that one of the measures it would introduce included relief for acquiring IP rich businesses. Smaller firms taking on apprentices will only have to contribute 5%, instead of 10%, to make it easier for them to take on the next generation of staffers.
The reaction from some business leaders was mixed with many welcoming the steps to make life easier for small businesses tinged with criticism that things had not gone far enough.
"Business rates could be scrapped completely and replaced with a sales tax of 1% or 2% which would apply equally to online businesses and those with a physical presence, as proposed by former Iceland and Wickes Chief Executive Bill Grimsey; with an energy tax as proposed by the British Retail Consortium or a more simplistic - but fraught with difficulties – profits tax or even a turnover tax. There are numerous alternatives available and AAT would like to see all of these properly considered," said Phil Hall, AAT head of public affairs & public policy.
There was also concerns that the problems caused by Brexit uncertianty were not addressed head on.
"The business rates relief for smaller retailers is also positive news. However, businesses are calling for more clarity regarding Brexit, and this budget was another missed opportunity by the Government to offer tangible support for SMEs during the withdrawal period. Many entrepreneurs are eager to embrace international markets beyond Europe, but without the right structures, many do not know how to access them," said Richard Green, CEO and founder of online event promotion platform Evvnt.