Struggling High Street firms are calling for an urgent business rates overhaul to help them ‘survive the winter’.
Retail and hospitality groups including shops, restaurants and pubs are facing skyrocketing costs and industry leaders say it is a ‘make or break’ week for Liz Truss and her government.
She was forced to delay a policy blitz upon becoming Prime Minister this month for the national mourning period following the death of Queen Elizabeth II.
Growth plan: On Friday Chancellor Kwasi Kwarteng will present a ‘growth plan’ to Parliament which is expected to scrap rises in corporation tax and reverse the national insurance hike
But Truss is now expected to kick start her premiership with a package of measures to boost the economy and stave off a wave of business closures and redundancies.
Business Secretary Jacob Rees-Mogg is today expected to unveil a support package for businesses which will cap energy bills in a similar manner to an earlier announcement for households.
And on Friday Chancellor Kwasi Kwarteng will present a so-called ‘growth plan’ to Parliament which is expected to scrap rises in corporation tax and reverse the controversial 1.25-percentage-point national insurance hike.
The announcements are part of a package aimed at boosting Britain’s flagging economy, with Truss saying yesterday ‘lower taxes lead to economic growth’.
But despite the expected tax cuts and support with energy bills, businesses are warning they face a ‘critical’ situation with tens of thousands of firms at risk.
In a letter to the Chancellor, the British Retail Consortium (BRC), which represents more than 200 major retailers, called for an immediate freeze in business rates.
The already burdensome tax is set for an inflation-linked increase which could add an extra £800million to retailers’ bills this year.
The BRC is also calling for a fundamental reform of the tax to lower the disproportionate burden faced by retailers.
‘Rising costs are starting to feed through into prices,’ said BRC chief executive Helen Dickinson in her letter to Kwarteng.
‘Consumer spending will be considerably constrained this winter with inflation continuing to climb and energy bills rising further.’
The cry for help was echoed by a separate coalition of the UK’s biggest retailers including Tesco and B&Q owner Kingfisher.
The Retail Jobs Alliance (RJA) called for an immediate freeze on the tax as well as an overhaul which would level the playing field between physical stores and their online rivals.
The alliance, whose members employ more than a million people, said cutting the tax will ‘turn the tide’ of store closures and significantly boost economic growth.
And a poll for the lobby group found a failure to overhaul the tax could risk Truss losing the next general election.
It found that a fifth of Tory voters would ditch the party at the next election without seeing ‘tangible improvements’ to their High Streets – blighted by boarded up shops after years of decline.
Meanwhile a group of leaders representing pubs, bars, hotels and restaurants said while the energy price cap would be a ‘lifeline’, more support is needed to help businesses survive.
UK Hospitality, the British Beer and Pub Association and the Campaign for Real Ale wrote to Kwarteng demanding a business-rates break until March.
They said: ‘These two measures, along with the energy cap, would allow our businesses the immediate breathing space to continue to serve their communities this winter and avoid an unfolding catastrophe.’