Labour vows to replace business rates in manifesto
Labour’s manifesto, which was published today, promises to revamp the high street by replacing business rates, reducing retail theft and fixing the "broken" Apprenticeship Levy.
In their own words, Labour's manifesto is "a plan to kickstart economic growth by reforming Britain’s economy and bring about a decade of renewal".
Leader Sir Keir Starmer promised several measures that could affect retail, such as capping corporation tax at 25%. It also laid out a new industrial strategy in an attempt to give businesses long-term certainty for investment decisions. Labour would retain permanent full expensing for capital investment and the annual investment allowance for small businesses.
The manifesto also mentions replacing business rates in England with a revenue-neutral system that levels the playing field between online and high streets.
Helen Dickinson, Chief Executive of the British Retail Consortium, said: "Labour recognises the current business rates system is broken – limiting business investment and leaving many retail premises empty. Retailers will want to see the details of what any replacement to our current system would look like. It is essential that any new system brings down the disproportionate burden on retail, which currently pays 22% of the total rates bill while accounting for 5% of the economy. Such reforms have the potential to incentivise vital investment and help diverse shopping destinations to thrive.
"While any plans are being consulted on, it is vital the current multiplier is frozen. Any solution must acknowledge that today’s customers shop both on our high streets and online and efforts to create a fairer system must not harm their ability to get high quality, affordable items, however they choose to shop."
Regarding the apprenticeship levy, which has been the concern of retailers including M&S, the manifesto says Labour will reform it, criticising the current system's "rigid rules". Its growth and skills levy would allow employers to fund non-apprenticeship courses deemed eligible by Skills England.
Dickinson added: "Since its inception, the BRC and our members have called for greater flexibility in the use of the current Apprenticeship Levy. Labour has hit the nail on the head when it says the current rigid rules ignore vital skills and training needed to access apprenticeships. The system must change, and a flexible Growth and Skills Levy could provide just the answer retailers and their employees have been looking for."
When it comes to crime, Labour ensured it would establish a new Neighbourhood Policing Guarantee, including the recruitment of thousands of new officers. In addition, it would establish a new specific offence for assaults on shopworkers that will protect them from threats and violence.
Dickinson concluded: "Rising rates of retail crime have been a blight on our high streets and retail centres. We welcome the pledge to create a new specific offence for assaulting a retail worker to protect our colleagues from both threats and violence. Furthermore, the manifesto pledges to get tough on shoplifting, which cost retailers £1.8 billion in 2023/24."