The Government has been urged to revamp the business rates system after the UK was named the country with the highest business rates bill across the EU.
A survey by property consultant Gerald Eve, which advises over 25% of FTSE100 companies, found that UK tax revenues from recurrent property taxes, including business rates, are currently equivalent to 3.4% of GDP, which compares poorly to the rest of the EU where countries typically raise 0.65% of GDP in this manner.
In 2010 - the last year which had a complete set of business rates data across the EU - total UK recurrent property tax revenues were €58.1bn, €13bn more than the second-most-heavily taxed nation, France, and nearly 15 times more than the EU average of €3.95bn per country.
Gerald Eve head of rating Jerry Schurder urged Government to “urgently overhaul” the frequency of valuations, the proportion of the overall tax bill that business rates make up, and the “fairness between high street and online retailers” after etailers including Amazon came under fire over its limited tax payments.
Schurder’s comments follow a hearing of the BIS select committee Inquiry into the UK retail sector and a Whitehall debate into the Government’s treatment of the high streets.
Retail Week has been urging the Government to create a fairer business rates system after extortionate rates bills have led to retailers investing less and stunting job creation.
Schurder said: “It is increasingly clear that the business rates system requires review and modernisation. It no longer shares the burden equitably but instead is treated by the Government as a cash cow, with the detrimental side effect of playing a major role in the decline of bricks-and-mortar retail.
“Whereas other countries are keeping property taxes low to help the businesses instrumental to their financial survival, it seems we in the UK are determined to keep turning the screws on our beleaguered high streets.”