As many as 60,000 small shops and 150,000 jobs could disappear without urgent business rates reform, Co-op has warned.
Despite repeated promises set out in previous budgets, research shows that 69% of UK adults believe the Government is likely to go back on its word to provide relief for small businesses.
If reforms are not delivered, 10% of small high street business owners say they would need let staff go, whilst 1 in 8 say they’d be at risk of closure. This would mean tens of thousands of closures nationwide, resulting in significant economic and employment consequences.
According to the Association of Convenience Stores chief executive, James Lowman, in the last year alone, business rate bills for convenience stores have increased by more than £100 million.
“These essential local shops are now facing significant further increases with the expected reduction of the 40% Retail and Hospitality Relief, coupled with next April’s revaluation, unless the Government commits to the full use of new powers to introduce a permanently lower multiplier for local shops,” explained Lowman.
The findings also show that 44% small high street shops would struggle to grow without protections, 36% would freeze pay rises, and 26% would halt hiring. Meanwhile, 77% back an online retail tax to level the playing field with online giants.
“As we approach a critical Autumn Budget, there’s a real danger that the voices of small shops – and the communities they serve – are not being heard. Local shops aren’t just businesses; they’re part of the social fabric of Britain. For some, a visit to a local store is one of the few chances they have to chat to someone and feel connected,” added Shirine Khoury-Haq, Co-op Group CEO.
“This research shows a clear public mandate for action. Regardless of how they vote, the majority of people want the Government to do more to protect their high streets. This is an opportunity for the government to really prove to people that they will do what it takes to make a difference to people’s communities and to their wellbeing.”
The Government’s current proposal is to provide permanent business rates relief for small retail properties, replacing temporary pandemic measures. Co-op is urging the Government to commit to the maximum levels of relief in the Autumn Budget and to implement swiftly to give small shops certainty.
“The proposed system would improve the financial situation of 99% of retailers,” continued Khoury-Haq.
“How much they are protected from tax rises depends on decisions made in this Budget. To boost local economies, create jobs and provide community cohesion, we need inclusive growth. That means supporting the businesses on the corners, in the precincts, on the parades and the high streets of every community. In order for them to not only survive, but to thrive, the Government has to commit to the maximum levels of relief.”
The Co-op Group is one of the world’s largest consumer co-operatives, operating across food retail, funerals, insurance, and legal services. It is owned by over 6 million active members.
The member‑owned retailer operates 2,300 Co-op shops across the UK and a wholesale network supporting 8,000 more, of which more than 4,000 are smaller independent retailers.
Co-op employs 54,000 colleagues and generates annual revenues of over £11 billion.
