Retail representative groups in Wales have asked the Welsh government to abandon plans for a new business rates surtax on the sector.
In a joint letter to Finance Secretary Mark Drakeford, the Welsh Retail Consortium and the British Independent Retailers Association warned that the surtax would “unfairly penalise” businesses and place them at a “competitive disadvantage” to companies across the border.
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The appeal comes ahead of the expected ratification of the Welsh government’s budget.
The organisations acknowledge recent measures, including more regular revaluations and a planned lower rates multiplier for the smallest retail premises. They described the latter as a “welcome and significant step forward” that should be retained.
However, they argue that retail already carries a disproportionate share of business rates and call for all retailers to be removed from the higher multiplier.
The letter stresses that “both small and larger businesses are vital to healthy high streets” and describes retail as “the lifeblood of Welsh high streets”.
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By GlobalDataThe trade bodies warn that the proposed surtax would particularly affect medium-sized and larger stores, potentially weakening town and city centres that depend on larger retailers to attract customers.
They point to the difference between the proposed retail multiplier in Wales and that in England, citing a rate of 51.5p in the pound in Wales compared with 43.2p in the pound in England. They argue that this could push investment over the border.
The letter states that higher operating costs risk adding to existing financial pressures on retailers, with potential implications for prices and the pace of economic recovery, as well as making Welsh locations less attractive for new or expanded investment.
The groups also urged the Welsh government to permanently exclude retail from the higher rates surtax.
They argue that a healthy retail sector underpins jobs, investment in urban centres, business rates income and efforts to reduce vacancy levels on high streets.
