Britain to slash property tax on small retailers

Britain to slash property tax on small retailers

The Chancellor of the Exchequer office said the annual spending plan will include £900 million (US$1.2 million) in relief for the yearly fees store owners pay on their retail space.

Philip Hammond
Britain's Chancellor of the Exchequer Philip Hammond arrives in Downing Street in London. (Tolga AKMEN/AFP)

LONDON: Britain's finance minister will propose slashing some property taxes when he reveals a budget on Monday designed to help half a million retailers compete with online rivals.

Philip Hammond's office said late on Friday (Oct 26) that the annual spending plan will include £900 million (US$1.2 million) in relief for the yearly fees store owners pay on their retail space.

The ministry said the measure will reduce by a third the payments of "496,000 small retailers".

Hammond's budget will be watched closely for signs of how Britain is preparing for its March exit from the European Union.

Negotiations between London and Brussels remain deadlocked and both sides are starting to make provisions for the possibility of Europe's second-largest economy breaking away from the 27-nation bloc without a deal.

Hammond is hemmed in on one side by Prime Minister Theresa May's announcement at the start of the month that Britain was ending the era of austerity that began in the wake of the 2008-09 global financial crisis.

But he must also exercise caution in case London and Brussels fail to reach a Brexit agreement.

Economists expect growth to suffer and government tax proceeds to shrink in a "no-deal" scenario .

And many of the austerity measures proscribed under previous governments are automatically written into this year's draft budget.

Hammond's promised tax cut is meant to address calls for reform from economists who point out that property taxes on businesses have been rising since austerity measures began in 2010.

Retailers are also suffering from ever stiffer competition from the likes of Amazon and big stores who are focusing more on online sales.

British brick-and-mortar operations have laid of thousands of workers this year.

The 240-year-old department store Debenhams announced plans to close 50 outlets - or a third of its entire business - after reporting a historic loss on Thursday.

Hammond's budget also provides for £650 million in spending on infrastructure and transport access for major shopping streets.

"This package will provide short-term relief for struggling retailers and a long-term vision for town centres, helping them to meet the new challenges brought about by our changing shopping habits," the finance ministry said.

Source: AFP/de

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