Business rates ‘woefully out of date’ for city venues

By Amelie Maurice-Jones contact

- Last updated on GMT

Out-of-date rates: Wrigley calls for Sunak to drop business rates for winter in the Autumn Budget (Getty/ Thomas Barwick)
Out-of-date rates: Wrigley calls for Sunak to drop business rates for winter in the Autumn Budget (Getty/ Thomas Barwick)

Related tags: Finance, Property, Manchester, Legislation, Budget

Eliminating business rates should be the Government’s focus in Wednesday’s Autumn Budget (27th October), said the owner of the Atlas Bar in Manchester.

Mark Wrigley hopes the Government will temporarily drop business rates and make a long-term pledge to reconstruct the a “woefully out of date” rateable value system.

He said: “We're still trying to rebuild our cash flow from surviving the closed-down period through Covid, so I'm hoping to take it back to zero for a period of time to get us through the winter months.”

Business rates were suspended in March 2020 by the Chancellor of the Exchequer Rishi Sunak, with companies starting to pay them at one third of the normal charge this June, which will be raised to the full rate come March 2022.

Wrigley said he was “really nervous” about the looming threat of a lockdown winter: a reduced cash flow will make it hard to pay wages, pension schemes and the cost of goods.

Tough luck for city venues

The accountancy advice organisation BDO predicted an enhancement to Research and Development reliefs in the Budget, with perhaps even higher rates of relief.

Furthermore, the company said it was possible that sector-based schemes aimed at recruiting workers would be announced in the Budget.

City-centre venues often pay higher business rates, as commonly have higher market rental value, which, according to Wrigley, adds to the hardship.

He continued: “People stayed away from the cities: people are still now not really coming on public transport, and the office workers are working from home Mondays and Fridays.

“So, our whole sales pattern and optimum sales opportunity for things like the breakfast trade range is massively reduced.

“There should be an acknowledgement that the rateable value of businesses, particularly for city centres, is woefully out of date, and not really fit for purpose anymore.”

Reduced VAT

The Conservative party have urged Sunak to help pubs by cutting beer duty for draught pints, and temporary VAT cuts for the hospitality sector from 20% to 5%.

Wrigley called for a maintained reduction of VAT. He said: “This keeps us more competitive and means we don't have to put our prices up.

“It gives us an opportunity to retain more cash from the current level of sales to rebuild our stocks. to rebuild our cash flow so that we can get back to a safer zone again.

“Cash is king in any business. Once you run out of cash, game over.”

Related topics: Legislation

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