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Business News Retail
Entertainment retailers welcome business rates relief, but want wider-ranging support
By Chris Cooke | Published on Friday 13 March 2020
The entertainment retail sector has echoed the sentiments of the grassroots venue community in welcoming the UK government’s announcement of a 100% cut to business rates for smaller high street enterprises, but also calling for support for those too big to qualify for that particular tax break.
Chancellor Of The Exchequer Rishi Sunak announced on Wednesday that high street businesses with a rateable value under £51,000 would benefit from a 100% discount in the year ahead as part of various measures to help companies deal with the negative impact of the coronavirus crisis.
For the venue sector, with an increasing number of shows and tours now being cancelled, the negative impact of COVID-19 is very apparent. But as fear of contracting the virus spreads – and as more people are urged to self-isolate as a result of having symptoms linked to COVID-19 – the high street at large is starting to see a downturn in customer numbers.
Therefore the tax break Sunak announced this week is important to independent retailers too, including those selling music, video and gaming products. The Entertainment Retailer Association reckons the move could save the average indie record shop between £15,000 and £22,000 per year.
To that end, ERA boss Kim Bayley said: “ERA welcomes this move by the Chancellor to help smaller stores. Rates are a particular burden on physical retailers, increasing their costs and making it harder to compete with internet-based businesses. This has only been exacerbated by the coronavirus outbreak”.
Venues and retailers with rateable values over £51,000 are also facing the same challenges, of course. Not least because ‘rateable value’ is based on a property’s estimated open market rental value, not the scale of the business based at that property. Which means businesses of similar sizes can fall above and below the £51,000 cut off simply based on the location of their premises.
Meanwhile, some would argue, the widely documented challenges of trading on the high street in 2020 mean that even bigger retail firms – including the national chains – are less equipped to deal with a sudden downturn in business caused by something like the public’s response to COVID-19.
Bayley added: “While [this week’s announced rates relief] will undoubtedly help smaller stores, it does nothing for the bigger high street chains who also face multiple business challenges. We will continue to lobby government to broaden the scope of this measure to support the diversity of our high streets”.
