The British Retail Consortium (BRC) has called for business rates to be frozen as UK inflation reaches a five-year high.
The Consumer Prices Index (CPI) hit 3% for September, according to the latest figures from the Office for National Statistics (ONS), up from 2.9% in August.
The last time inflation was at this level was March 2012. Meanwhile, the September Retail Prices Index has reached 3.9%.
In response, BRC chief executive Helen Dickinson warned that a resulting hike in business rates – set against September’s RPI – would leave retailers “struggling to survive”.
Read more: Rates have retailers staring down the barrel
She said: “The consequences of today’s RPI figures could be severe for many shops in a precarious position and struggling to survive.
“Consumers, already seeing household incomes eroded, will face further misery as the pound in their pocket buys them less at the checkout.
“For retailers this will be compounded if UK ministers fail to act and stem the hefty near 4% rise in business rates, which is set to add an extra quarter of a billion pounds to retailers’ already unreasonable business rates burden.
“For many shops this may be the last straw. Across the country, especially in economically deprived and vulnerable communities, the cost of failing to take action will likely be seen in yet more empty shops and gap-toothed high streets.”
The BRC fears that, if the Government does not step in and freeze business rates, retailers and other firms will face a rates rise twice as large as last year, and it “will hit retailers alone with an extra £273m in tax next April.”