Value giant B&M and specialist retailer Pets at Home have become the latest retailers to waive business rates relief after Tesco sparked a spate of such initiatives earlier this week.
Their return of cash totalling almost ÂŁ110m by the pair followed similar action by big grocers yesterday including Aldi, Asda, Morrisons and Sainsburyâs.
B&M and Pets at Home were both able to trade during lockdown. B&M said that it âwelcomed the governmentâs business rates relief, given the disproportionate burden business rates places on physical stores versus online competitors, particularly at a time when the nature and duration of Covid-19 restrictions were unknownâ.
However it concluded that âit is now right to forego the business rates relief granted to B&M, which is approximately ÂŁ80m this financial yearâ The retailer, which has already returned furlough cash, said that it will engage with local authorities on âan appropriate mechanism to waive the business rates reliefâ.
The retailer called on the government âto create a level playing field that requires all essential and online retailers to contribute proportionately in terms of taxation and business ratesâ.
Pets at Home will return the ÂŁ28.9m of business rates relief it received. It said the decision âreflects the companyâs guiding principle of treating all stakeholders fairly and is supported by the continuing strong performance of the businessâ.
The decision means that the financial impact of the pandemic on Pets at Home, estimated at about ÂŁ35m, âwill no longer be offset by the rates relief receivedâ but that it was âmore than ever, confident in the strength and longevity of our pet care platform and proud to be repaying the business rates relief from this position of strengthâ.
B&M chief executive Simon Arora said: âWe are proud of the role we have played in this crisis, working very hard in our supply chain and stores to ensure our shoppers can rely on us for their everyday essentials, whilst creating over 1,800 new jobs, making charitable donations to local food banks, [and extending discounts to NHS workers.
âWe request urgent reform of the outdated business rates system that is contributing to job losses across the retail sector and is acting as a deterrent to B&M and other potential occupiers taking up vacant space in many locations.â
Tescoâs decisin to forego rates relief has angered some other retailers who feel they are being bounced into a similar stance.
Not all businesses that stayed open during lockdown have decided to waive rates relief. A Co-op spokesperson said: âWeâre still facing huge uncertainty and are incurring ongoing costs. We will consider our approach in terms of the government support weâve received at year-end.â
A Poundland spokesperson said: âWhile Poundland was classed as an essential retailer, it wasnât one of the retailers that saw extraordinary levels of business during lockdown, like the supermarkets or Amazon. Thatâs because it trades largely on the high streets that closed for business and now need support to get back on their feet.
âItâs hard to understate the importance of the rates holiday to Poundland to help protect its business, invest in the measures it put in place to trade safely and maintain employment.
âPoundland remains of the view there needs to be a rebalancing of the cost of doing business between those online and supermarket retailers who were winners from covid and able to pay large dividends, and those who continue to support the high streets that are important to communities.â
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