Ahead of COP26, employers representing more than 261,000 businesses and nine million employees say business rate reform is essential for green investment
The United Warehousing Association (UKWA) has joined the CBI, along with 40 other trade associations across the UK, in issuing a statement outlining how action by the Chancellor at the Budget, to reform the current business rates system, could unleash a wave of business investment across key government priorities, including net zero and levelling up.
The signatories believe that the existing business rate regime in England is outdated and outmoded, acting as a drag on the government’s goal of a high wage, high productivity and high investment economy.
With up to 50% of business investment potentially subject to business rates, the current system actively disincentivises business investment in decarbonisation and wider investments which can improve all-important productivity, which is the only sustainable route to higher wages.
Rain Newton-Smith, CBI Chief Economist, said:
“Action to get investment flowing into and around the UK is sorely needed to reinforce our recovery. The Government deserves credit for convening the supply chain advisory group to unblock temporary challenges, but as we’re seeing with energy prices, there is no substitute for longer-term planning and investment.
“The Chancellor has an opportunity to fix this, starting with fundamental business rates reform at the Budget and Comprehensive Spending Review. By setting out an approach which attracts investment, he can equip the UK with the tools it needs to secure the high wage, high productivity and high skill economy of the future.
“With up to half of business investment potentially subject to business rates, it has literally become a tax on investment. Action to stimulate investment, starting with business rates reform, unites firms spanning the whole economy. If the government is serious about achieving its net zero ambitions, kicking reforms further into the long grass cannot be the answer.”