Tesco CEO Sir Terry Leahy has called on the UK government to cut business rates in order to help mitigate the impact of the economic downturn on retailers.
Go deeper with GlobalData
Speaking today (11 November) at the annual conference and showcase of retail property organisation the British Council of Shopping Centres in Liverpool, Leahy emphasised the positive impact retailers have had on deprived communities.
“Our industry has become a dynamo of growth and social mobility, transforming communities, sparking enterprise, giving people new hope and opportunity,” he said.
However, Leahy warned, the current economic climate is putting retailers under pressure to reign in investment, which could have a knock-on effect on employment around the UK. He called on the Government to respond by cutting business rates.
“Retail is being particularly hard hit by business rates because it is highly dependent on property,” Leahy observed.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“On this I make three suggestions. First, a cut in the Uniform Business Rate multiplier for 2009/10. This would mean many businesses would not see their business rates increasing during a recession. Second, the Government should postpone the 2010 revaluation of business property, which would otherwise by based on April 2008 property values. Third, in the long term, business rates themselves should be reviewed. They do not reflect the changing nature of businesses today with the value of property no longer providing a reasonable indicator of profitability.”
Leahy said that the way businesses are assessed should be reformed to “ensure a fairer spread of tax liability across business sectors”.
“A new system should reflect today’s priorities for society. For example there should be business rate relief for investment in deprived communities, energy efficiency measures and green technologies,” he continued.
With Tesco’s appeal against the establishment of a competition test in planning applications about to begin, Leahy also took the opportunity to attack the findings of the Competition Commission after last year’s investigation into the grocery retail market.
“The proposed competition test and the ombudsman will hamper what is already a highly competitive market,” he said.
