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| 1 minute read

London Retail Faces Looming Crisis as Exclusion from Business Rates Relief Threatens Economic Recovery

Many retail, hospitality and leisure properties in London may face an additional £575 million in business rates next year, as they are excluded from the chancellor's business rates support measures. Jeremy Hunt recently unveiled a £4.3 billion business rates relief package, extending the 75 percent rate relief schemes for another year, but this applies only to 230,000 properties in England. Larger properties, including designer department stores Selfridges and Harrods, will see substantial increases in rates, with both stores facing an increase of well over half a million pounds.

It is thought that the choice not to extend support to larger properties could negatively affect the wider retail market. The absence of intervention for businesses surpassing the £51,000 rateable value cut-off for relief is viewed as both surprising and disappointing. The anticipated 6.7 percent increase in business rates for the 61,650 non-domestic properties in London in April may impede post-pandemic retail recovery and potentially result in a rise in business insolvencies.

As London's retail and hospitality sector grapples with the aftermath of the pandemic and a cost-of-living crisis, industry leaders have expressed real concern with the proposed business rates hike. Kate Nicholls, chief of UKHospitality, notes that the 6.4% increase in the standard multiplier will result in almost two-thirds of the sector's trade facing a £150 million rate hike, putting further pressure on consumer prices and inflation amid challenges with energy, food, drink, and wages.

“the standard multiplier rising by 6.4 per cent will see businesses representing almost two-thirds of the sector’s trade still facing a £150m rate hike.“


real estate, business rates, hospitality