Editor: The Budget offered the industry some clarity on what will happen when the 12-month business rates holiday for retail, leisure and hospitality ends this month. But the mere three-month extension fails to realise the scale of the problem facing businesses’ bottom lines, or the issues of the business rates system itself.

Rishi Sunak masked

Source: Shutterstock/ Ilyas Tayfun Salci

Surely expanding the furlough scheme until September indicates that the economy will not recover by June, so why hasn’t Rishi Sunak provided the same extension for business rates relief?

Swathes of businesses will not benefit from the extension. Offices are excluded from rates relief, as are medical use buildings, even though they are on the frontline of the pandemic. Shops that have been able to stay open may not be able to benefit from the two thirds reduction after June. Finally, empty properties don’t get any retail relief – why?

The £6bn tax cut and £5bn grants package will offer a lifeline to many businesses. However, it is disappointing that this extension was not announced earlier when we entered the third national lockdown, giving businesses and landlords critical time to budget.

Also, this relief extension only tells a fraction of the story: the business rates system is crippling the high street. If the government doesn’t haul it into the 21st century with four key adjustments, it risks undoing all the good work of its Covid support packages.

First, empty rates relief must be extended from three months to six months. Second, the UK’s extortionate Uniform Business Rates (UBR), currently 50p in every £1, must be cut to about 30p. Third, downward transition, which is crippling businesses in the North and Midlands, must be abolished, so the system better reflects falling rents. Finally, the system must become more flexible and allow retailers to easily adjust rates to set up innovative mixed-use businesses. The current Check Challenge Appeal (CCA) process is time-consuming at best and impossible at worst.

Sunak said this Budget focused on getting people into quality jobs, but if he ignores business rates, there won’t be any businesses left to offer jobs. We hope these issues will be addressed by the business rates review, but as this has been delayed until autumn, we will have to wait for months for answers.

Martin Davenport, head of business rates and professional advisory, Hartnell Taylor Cook