It almost beggars belief that the row over business rates continues to rage on.
Many retailers in prime locations like London’s West End, Manchester or Glasgow have already suffered hikes in their commercial property taxes in the wake of revaluations earlier this year.
But an eye-watering £280m is now set to be added to the industry’s already extortionate business rates bill in April 2018.
The Office for National Statistics revealed this week that retail price inflation hit 3.9% in August and is poised to surpass 4% in September – the rate that will be used to determine the increase in business rates next April.
They are sharp rises that have the potential to send smaller operators to the wall and make larger retailers think twice about expanding their store networks.
“The UK, now more than ever, needs a thriving economy, spurred by flourishing and profitable businesses, to help maintain stability.”
Indeed, figures from the Local Data Company showed that the number of new shop openings tumbled 84% in the second quarter of 2017 compared to the same period a year ago, as retailers make more considered approaches towards taking bricks-and-mortar space.
As we head towards Brexit – something that inched ever closer when Parliament passed the EU Withdrawal Bill at its second reading on Monday – the UK, now more than ever, needs a thriving economy, spurred by flourishing and profitable businesses, to help maintain stability.
A vibrant and successful retail industry is central to achieving that goal.
After all, this is an industry that accounts for one-third of all spending from British consumers.
It is an industry that amassed £358bn in sales last year. It is an industry that employs close to three million people.
And it is an industry that has 192,000 VAT-registered businesses contributing to government coffers.
“Investment-sapping tax hikes will leave retailers swimming against an increasingly higher tide and, in some cases, drowning.”
Saddling traditional store-based retailers with an even more onerous tax bill doesn’t just represent the government shooting themselves in the foot – they are practically hanging themselves.
The business rates reform that retailers have long lobbied for is fast becoming critical, particularly as companies grapple with a host of other policy-induced cost headwinds such as the national living wage and the apprenticeship levy.
Retailers need room to breathe, to think strategically, and to invest in the speedy fulfilment and experiential arenas that consumers are craving.
Instead, such investment-sapping tax hikes will leave them swimming against an increasingly higher tide and, in some cases, drowning.
As the British Retail Consortium’s director of business regulation Tom Ironside put it this week, “retailers are staring down the barrel”.
If the UK is to have a fighting chance of beating any Brexit blues, the government must finally heed retailers’ calls to create a more affordable and sustainable business rates system – before it’s too late.
Despite the punchy business rates being charged to trade in the UK, international retailers continue to flock to these shores.
Polish fashion titan LPP became the latest overseas operator to invade Britain last week when it launched its Reserved fascia on London’s Oxford Street.
It joins a growing list of international fashion brands, including the likes of Canada Goose and H&M-owned duo Weekday and Arket, who are willing to bear the property cost burden in order to secure coveted London sites.
But can Reserved live up to the hype of its opening day, when Kate Moss stole the show, by making its mark on a competitive fashion market?
Yet one thing is for certain: its arrival will not have escaped the attention of its new competitors.
Retailers regularly say “we welcome the competition” when new rivals emerge – and that is far from just a party line.
Hotter competition drives retailers on to be more innovative, more competitive on price and more relevant to the customer.
Regardless of whether or not Reserved succeeds, that wider impact has got to be positive.