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Labour vows to save small shops & factories £4,000 with business rates shake-up

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Shadow Chancellor Rachel Reeves hopes to take the burden off struggling small businesses and save our high streets.

Labour has promised to save small shops £4,000 with plans to freeze business rates.

Shadow Chancellor Rachel Reeves said she will help struggling businesses with an increase to the threshold for small business rates relief, from £15,000 to £25,000.

This could give small businesses a discount on their bill for 2022/23.

It follows the Mirror’s High Street Fightback campaign to fight for our village, town and city centres.

Under current government plans, businesses like these are due to pay £9,831 in business rates in 2022/23. But Labour said they would pay £5,824 when in charge.

On top of this, Labour plan to pay for this with a one-off rise in the Digital Services Tax from 2 to 12%.

Shop bosses slammed Rishi Sunak for not using his Autumn Budget as an opportunity to reform business rates
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Image:

Greg Martin / Cornwall Live)

And they have also committed to scrapping the business rates system entirely in the first term of a Labour government, replacing them with a new system of business taxation fit for the 21st century.

They believe this will shift the burden of business taxes to create a level playing field between high street businesses and online giants.

Ms Reeves said: “Our small businesses are struggling right now, with a cliff-edge in rates relief coming up in March.

“The next Labour government will scrap business rates to support our small businesses and high streets.

“We will carry out the biggest overhaul of business taxation in a generation, so our businesses can lead the pack, not watch opportunities go elsewhere.

“Labour’s approach will be based on working together with our small business, pulling together in a national endeavour to rebuild Britain and to seize the opportunities of the future.”

The Shadow Chancellor is calling for a business rates shakeup
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Image:

Getty Images)

Chancellor Rishi Sunak froze a planned rise in rates next April and announced a one-year rates discount of up to 50%.

The Shopkeepers’ Campaign accused Rishi Sunak of “betraying the high street” and warned of “more retail bankruptcies and job losses”.

Scrapping the tax would help revive traditional “bricks and mortar” retailers in the wake of the Covid-19 crisis, according to think tank Demos.

They believe this will shift the burden of business taxes to create a level playing field between high street businesses and online giants.

It comes ahead of Small Business Saturday and follows news earlier this week of a Make UK survey showing that Britain’s manufacturers are facing a “perfect storm” crisis of rapidly rising costs and towering debts that many fear could push them over the brink.

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