Retailers hope George Osborne will next week reveal a change in the way costly business rates are calculated when the Chancellor presents his Autumn Statement.
At present business rates, which represent a heavy cost to retailers, are calculated using September’s RPI rate of inflation. RPI this September hit 5.6%, and that would lead to the biggest annual jump in rates for more than 20 years when they are calculated in April.
But the British Retail Consortium has been pushing for business rates to be calculated on the September CPI measurement of inflation instead, which would reduce the cost burden. Due to outline the Government’s priorities on Tuesday, retailers hope Osborne will review the decision to increase fuel duty and put a limit on minimum wage rises.
BRC director-general Stephen Robertson said: “The majority of the Government’s indices are now based on CPI and not RPI, and we think to avoid a major impact on the retail sector, it would be appropriate for the Government to [base business rates on CPI].
“If we don’t see this change, the Chancellor should phase the 5.6% business rate increase over time.”
The BRC has calculated that the RPI increase could cost UK retailers between £300m and £400m.
Robertson was critical of the Government’s over-regulatory approach, which he said has not improved despite its deregulatory stance.