The Chancellor, Philip Hammond, has announced that he’ll cut business rates by one third on retail properties with a rateable value of up to £51,000. It’ll be music to the ears of many running small high street businesses.
It’s something for which we’ve campaigned for some time. We’ve seen firsthand the impact that business rates taxes have. Small businesses are forced out to the fringes of towns, while the middle of towns is – at the same time – hollowed out by business failures amongst major retailers and restaurant chains.
Many high streets are in poor shape for so many reasons. Onerous business rates are just one. And it’s getting worse. Many have retail units both large and small vacant, some for years.
The measure will – it’s said - benefit 90 percent of independent shops, pubs and restaurants, cutting bills by up to £8,000. That’s a hefty amount and may well mean the difference between success and failure.
It comes not a moment too soon as, frankly, if we want high streets at all, we can’t continue to lose retailers at this alarming rate.
There are, of course, a variety of ills afflicting the high street.
In recent years there’s been a move to plug the housing gap by allowing local authorities to convert empty premises to residential property.
While this is, in itself, a laudable aim, it does change the character of towns. It can contract the size of town centres, but at the same time create greater footfall and a ready market for shops, hospitality etc.
As an Ipswich-based company we’re full of praise, of course, for the Borough Council’s ambitious plans to transform our local town centre. The exciting scheme to regenerate the Cornhill is nearing completion and will create a real focus to the town.
But taking the wider view, while we’re losing shops in town centres, out of town retail parks are booming. As too are the fortunes of online retailers.
Twenty first century retail is a rapidly changing scene.
The question is, can our Chancellor save our high streets by tweaking tax rates?
One thing’s for certain. We won’t be seeing retail functioning in the way it did before the turn of the century.
We believe there’ll continue to be destination shopping centres where there’s a real reason to make a day-long trip. The footfall will support retailers large and small and independents on the periphery will be beneficiaries too.
And smaller market towns, especially those with a friendly vibe and an alternative offering, will survive too.
But for those town centres that are already struggling badly, I’m wondering if it’s already too late.
Those town centres need a reason – often sadly missing – for people to visit. They’ve often neither the critical mass of shops, nor that bustling vibe that makes them a joy to visit. Gaps in the main shopping areas make them feel sad and neglected. And they have become trapped in a downward spiral.
You could argue that, for them, the horse has already bolted... with out of town retail parks snatching business away. They’re places that are more accessible, have free parking and all that it takes is a quick in and out to pick up what you need.
So yes, it’s a welcome move... but will it halt the decline? I fear probably not as much as we might have hoped.