Frasers calls business rates relief "near worthless", reviews portfolio
In a typically blunt statement, Frasers Group on Friday blasted Chancellor Rishi Sunak’s Budget as doing virtually nothing for hard-pressed retailers on the business rates front. And it suggested that some of the company’s stores are at risk as a result.
The company said it “wishes to note its disappointment at the business rates relief announced. Whilst the retail industry as a whole has repeatedly asked for structural reform of business rates, none has been forthcoming. Frasers Group and many retailers would have expected suitable relief until structural reform is implemented”.
It added that the £2 million rates cap on businesses from July until March next year “makes it a near worthless support package for large retailers”.
What that means for the company is that it “will make it nearly impossible to take on ex-Debenhams sites with the inherent jobs created. It will also mean we need to review our entire portfolio to ascertain stores that are unviable due to unrealistic business rates”.
There had been talk in recent weeks that Frasers was eyeing a number of soon-to-close Debenhams sites and news that it’s unlikely to take any of them on is disappointing for retail in general. So far, most of the solid plans announced for former Debenhams stores seem to be around converting space in them into residential units.
But the prospect that Frasers could also look again at its existing stores portfolio is perhaps even more worrying and raises the prospect of further closures of sites unable to pay their way.
The company added that “retailers should pay the fair amount of rates in line with realistic rateable values, but instead we continue to have an unwieldy, overly complex, and out of date business rates regime”.
Retailers across the board have been complaining about business rates for years given that they bear a disproportionately large burden compared to other businesses.
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