Rachel Reeves’s £1.7BN tax attack will put 120,000 high street jobs at risk, airline and hospitality bosses have warned.
The British Retail Consortium (BRC) and the hospitality industry have raised new concerns about the Chancellor’s plans to cool the high rates of business in redores, hotels, holiday parks and restaurants.
Trade groups estimate that hundreds of sites could close as a result of the changes, resulting in around 120,000 job losses.
Under the proposed business value tax, which will take effect next April, companies with large properties face increased taxes to offset the costs of smaller sites.
Workers argued that the change would be designed to help revitalize the city’s facilities.
This is because the changes are designed to increase the playing field between high street locations and online items, where collisions occur where large warehouses are hit.
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However, hotel managers and hoteliers say that it risks doing the opposite and forcing the so-called large entertainment centers to have fun.
Helen Dickinson, Executive Chief Executive, urged ministers to give retailers exemptions from high business rates to “protect hundreds of anchor stores and the vital jobs they support”.
Kate Nicholls, chairman of Khoko, said the Chancellor needed to get businesses back to “develop places where people want, work and invest”.
Tesco and Sainsbury’s warned the Chancellor earlier this year that high business rates would accelerate the high street’s decline.
In July, Sir Tim Martin, chief executive of JD Wetherspoon, said the Shake-Up would “increase the disadvantage of the already heavy tax that pubs operate under”.
Since then, businesses have come under more pressure as consumers again spend ahead of budget.
Figures from the Confederation of British Indus’s (CBI) Distribution of Exposed Retailers revealed they sold around 27pc less in the year to October compared to the same period last year.
Martin Sartorius, chief economist at the CBI, said: “Consumer confidence remains poor, combined with caution raised ahead of next autumn’s budget.”
Managers are understood to have met with Treasury officials in recent weeks, urging them to exempt large travel firms from higher business rates.
One supermarket source said the government had been warned that the planned changes threatened to drive up food prices, which have already fallen by nearly 5pc in the past year alone.
It comes after retailers were hit with higher costs in last year’s budget when the chancellor increased national insurance rates and the minimum wage. New packaging taxes have also put businesses under pressure.
