With just over a week until the Autumn Budget, speculation is mounting as to the potential impact of the recent cabinet reshuffle on business rates payers. Jeremy Hunt retains his role as Chancellor of the Exchequer, however Michael Gove, Secretary of State for Levelling Up, Housing and Communities and overseer of business rates policy, has not been moved, giving cause for some optimism.
The 2022 Autumn Budget saw a series of measures to support businesses, including freezing the multipliers at 51.2p (standard multiplier) and 49.9p (small business multiplier), resulting in business rates remaining at their highest levels since their introduction in 1990. Due to the Consumer Price Index (CPI) for September 2023 stagnating at 6.7%, an increase of over £1.5 billion in business rates bills is expected in 2024.
Anthony Hughes of RVA Surveyors said “When major shifts happen in politics, we need to sit up and pay attention, especially when we are so close to events like the autumn budget. Incoming policy changes could mean make or break for so many over this holiday period alone.”
David Kelly, Head of Insolvency at PwC, stated that according to October figures, smaller businesses are bearing the brunt of increased insolvencies in England and Wales, adding that they expect the number of insolvencies to remain high in the coming months.
Business leaders from some of the UK’s biggest retailers and chains have urged the government to take immediate action on business rates before the expected increase. However, with Gove and Hunt remaining in their positions, the government appears confident in their ability to manage business rates policy in the long-term.
“Cabinet reshuffles can bring a sense of dread, because you don’t know who’s going to take over a position, or even if they’re qualified for it. Right now, announcements on business rates policy for the autumn budgets is unlikely to change from what we think it’s going to be,” said Hughes. “An additional bill of over £1.5 billion is the last thing commercial property owners and tenants need.”
Derick is an experienced reporter having held multiple senior roles for large publishers across Europe. Specialist subjects include small business and financial emerging markets.