Osborne’s £14bn “rates bomb” could put 40,000 shops out of business

MORE than 40,000 high street shops will close by 2020 unless George Osborne softens a “£14bn business rates bombshell”, store bosses and campaigners have warned.

Industry chiefs told the Treasury this week that nearly a third of high street stores could disappear because the Chancellor is “sucking the life out of town centres” with sky-high business rates.

Officials have already met with Treasury Secretary David Gauke privately to warn him.

 The British Retail Consortium is demanding a cut to rates in the Budget later this month – saying rates are “choking off investment” in the UK’s high streets.

The trade body says that combined with the cost of meeting the new Living Wage, and a levy to fund new apprenticeships, retailers face a £14bn hike in costs over the next four years.

BRC chief Helen Dickinson told the Sun newspaper yesterday: “The Government needs to wake up and realise that its policies are going to be a tragic failure unless there’s a major rethink.”

The Treasury generates more than £20bn from rates each year – with more than £7bn coming from high street stores. Last year the Chancellor announced plans to devolve rate setting powers to local councils – but this transfer won’t take place until 2020 and many fear this will result in costs escalating further.

The BRC warning came as the CBI warned businesses were facing a crippling burden from “policy costs” – such as rates and the Apprenticeship Levy – and warned it was hitting UK companies’ ability to “drive growth”.

CBI chief Carolyn Fairbairn said: “The danger of this rising policy burden is that it holds back businesses, particularly smaller firms.”

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