High street will 'collapse' without changes to 'excruciating' rise in business rates, Labour MP warns

The MP for York Central said she is "pleading with the government" to "bring around proper reform of business rates".

In the Autumn Budget, Chancellor Rachel Reeves confirmed that a new business rates system will be introduced from the next financial year.

This will see rates multipliers lowered for retail, hospitality and leisure firms – funded by higher rates on larger commercial properties, including warehouses.

It also means that firms with larger premises, like storage companies and supermarkets, will be hit with a property tax rise.

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The Treasury said the move was designed to “rebalance the business rates system” and help smaller firms by putting more of the tax burden onto bigger operators.

Rachael Maskell said: "I look across York and it is excruciating the rises which people will see to their business rates.

"The problem has been that we've seen the revaluation coming at the same time and that's just pushed people over the line and certainly to the edge."

She added: "The business community have got many, many ideas of how that can be done in a fair and proportionate way, but certainly not one that puts such demands on businesses that traders are saying that their doors will not be able to sustain this increase."

Ms Maskell said she is meeting with the Chancellor in the new year to discuss businesses in York.

"It's eye watering figures when you're talking about, for instance, hospitality on average in York will see a 41% increase in business rates. That's just unsustainable," she said.

"You can't sell that much beer to make up the difference."

When asked if she is seeking substantial changes to Reeve's proposals, Ms Maskell said: “It's got to be or else the high street will collapse.

"So, I really do want the engagement with ministers over the coming weeks to ensure that we do address this real pressure being placed on our high street businesses, particularly independents, are really hard hit by this."

A Treasury spokesperson said: “With Covid support ending and valuations rising, some firms may face higher costs – so we have stepped in to help businesses, as part of a £4.3 billion support package.

“We back Britain’s businesses which is why we have capped Corporation Tax at 25%, the lowest rate in the G7 and permanently lowered business rates tax rates for eligible retail, hospitality and leisure properties.”