High street retailers are facing a catastrophe unless the Welsh Government provides further help to protect small businesses affected by an imminent change to business rates, Monmouth’s MP has warned.
Following increasing concern from town centre traders and Monmouthshire County Council about the impact of the independent Valuation Office Agency’s first business rate revaluation in seven years, Welsh Finance Secretary Mark Drakeford announced £20m of additional support for those hit by huge hikes – with £10m specifically targeted at the high street.
Around 400 businesses in Monmouthshire could be eligible for up to £1,500 off their rates bill in 2017-18.
But David Davies MP said the funding, which has been brought forward for the whole of Wales, does not go far enough and still left many independent firms under threat of closure when the revaluation comes into force on 1 April.
He is demanding that Wales should offer the same financial assistance as England, where Chancellor Philip Hammond has unveiled a package of measures to ease the burden on hard-pressed businesses.
These include a monthly cap, meaning no business or pub in England losing small business rate relief will see their bill increase by more than £50.
“We are facing a catastrophe on local high streets if the Welsh Government fails to recognise the damage set to be inflicted on businesses across Monmouthshire,” said Mr Davies.
“I have been warning about this since the autumn and backing urgent calls by council leaders for a delay in implementing the new tariffs.
“Unless something drastic is done, we will definitely see cherished family-owned businesses shut down and there is a real fear it could trigger a rapid decline of our colourful town centres.”
The Budget on 8 March delivered an extra £200m to the Welsh Government over four years.
Mr Davies said he would be pressing Mark Drakeford to allocate a proportion of that money to ensure small businesses in Wales receive exactly the same level of support as businesses in England, which he described as “altogether much more generous”.
In an age when the digital revolution is transforming the way consumers shop, he also suggested it was time to tax businesses based on profit – not on a “bureaucrat’s view” of how much a property can be rented for.
“The system of business rates is unfair, outdated and deters investment,” added Mr Davies.
“Taxing businesses on the basis of rent values seems a somewhat archaic approach in a modern economy.”