Several of the UK’s largest supermarket operators have written to Chancellor Rachel Reeves requesting that large food retailers be exempted from a proposed business rates surtax.
Aldi, Asda, Lidl, Morrisons, Marks & Spencer, Sainsbury’s, Tesco and Lidl all signed the letter organised by the trade body the British Retail Consortium (BRC).
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The letter argues that including supermarkets in the surtax on properties with a rateable value above £500,000 ($6,66,220) would add to the sector’s costs and risk passing higher prices on to households, stating:
“Consumers benefit from some of the lowest food prices in the developed world. And while we continuously seek efficiencies, our ability to absorb additional costs is diminishing… If the industry faces higher taxes in the coming Budget – such as being included in the new surtax on business rates – our ability to deliver value for our customers will become even more challenging, and it will be households who inevitably feel the impact.”
The signatories add that large retail premises represent a small proportion of all stores but account for a third of retail’s total business rates bill, and that “another significant rise could push food inflation even higher”.
The supermarkets have asked the Chancellor to “address retail’s disproportionate tax burden”, saying this would “send a strong signal of support for the industry and of the government’s commitment to tackling food inflation”.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataCommenting on the letter, BRC CEO Helen Dickinson stated:“Large retail stores sustain nearly one million British jobs and already contribute a third of all retail’s business rates, despite being a tiny proportion of all stores. This letter calls on the Chancellor to exempt shops from the new business rates surtax – levied on all large commercial premises. This would not only help to tackle food inflation but would support jobs and investment right across the country.
“The Chancellor has rightly made tackling inflation her top priority, and with food inflation stubbornly high, ensuring retail’s rates burden doesn’t rise further would be one of the simplest ways to help. This would not cost the taxpayer a penny, with large office blocks and industrial plants, for whom business rates is a smaller proportion of their costs, paying a little more.”
