EXCLUSIVE: British Retail Consortium in row over policy on business rates

Bill Grimsey accuses the BRC of ignoring Labour’s policy

The British Retail Consortium, which represents the biggest names on the high street, has come under fire for appearing to advocate a rise in business rates in its latest policy document.

The criticism comes as Labour promised to cut business rates by 1 per cent in 2015 if it wins next year’s election.

In the BRC’s Manifesto Milestones document, which lays out the organisation’s plans to lobby politicians for a change to the tax on commercial premises, it calls for a “continuation of the 2013 Autumn Statement 2 per cent cap [rise]”. However, campaigners pointed out that the Labour Party had already promised a freeze on business rates last year.

Yesterday the Labour leader, Ed Miliband, went further, proposing a 1 per cent cut in rates at the Labour Party’s annual conference in Manchester.

The veteran retailer Bill Grimsey, who wrote a report into the state of Britain’s high streets, accused the BRC of ignoring Labour’s policy.

He said: “The Labour Party has made it clear for some time that they would cap it so the BRC seem to have predicted the next election, which seems very odd.”

Yesterday the BRC said that it welcomed Labour’s proposals to cut rates in 2015, and looked forward to discussing broader reforms with the party.

Aspokeswoman added: “The BRC believes the 2 per cent cap on existing rates is an important short-term measure but our real focus is on securing commitment to a process for moving towards fundamental reform.”

The issue of business rates has risen up the political agenda and led to the Government last December announcing a 2 per cent cap on the yearly rise in the tax, instead of the usual rise in line with retail price inflation.

The tax is based on the value of each property from 2008, and has failed to take account of the falls in values of many high street stores during the recession. It is also under fire because online-only retailers do not have to pay rates bills.

The British Independent Retail Association is calling for small retailers to be moved out of business rates entirely, by raising the minimum rateable value, since the vast majority of rates are paid by bigger stores.

Critics of the BRC point out that it receives most of its funding from the biggest retailers, who have the most to lose from a major revamp of the tax system. It has been praised for its campaigning on the issue, but some have questioned the body’s impartiality because its rates review committee is chaired by the finance director of Sainsbury’s.