There’s no ignoring the challenges endured by Britain’s high streets over the past 18 months. With the furlough scheme and other financial support measures, the government have helped many businesses weather the storm.
As we enter the latter stages of the pandemic, Rishi Sunak’s Autumn Budget and Spending Review has given the retail, leisure and hospitality sectors hope for 2022. In this week’s blog, we’re exploring the Chancellor’s announcements and what they mean for Britain’s high streets.
Business rates reduction
Rishi Sunak ushered in his “new age of optimism” with a series of key reforms; the most encouraging of which was the announcement of a business rate discount for the retail, hospitality and leisure sectors. With this, businesses will be able to claim 50% off their bills at the end of the tax year for the value of up to £110,000.
More good news came when the Chancellor confirmed that the freeze in the multiplier will continue until 31 March 2023, rather than an increase in line with inflation. The tax relief on museums and galleries is also to be extended for two years, so that it expires on 31 March 2024.
Online sales tax
To address the imbalance between ecommerce and high street sales, the government announced a consultation on a new ‘online sales tax’. The revenue from which would be used to reduce business rates for in-store retailers in England.
Alcohol Duty Reform
Another important announcement for the high street was the simplification of alcohol duty, based around the principle of ‘the stronger the drink, the higher the rate’. The main duty rates will be cut from 15 to 6.
These changes will bring some welcome duty reductions to prosecco drinkers as well as fruit ciders. Draught relief is being proposed which will cut duty on draught beer and cider by 5%, taking 3p off a pint – good news for the nation’s pubs. Craft producers are also being promised lower duties which will be good news for these industries.
Sunak says it’s the ‘biggest cut to cider duty since 1923 and the biggest cut to beer duty for 50 years.’ And he hopes this will ‘benefit community pubs, who do 75 per cent of their trade on draught’.
At Targetfollow, we welcome the measures announced by the Treasury to invest new funding to boost high streets and town centres and facilitate re-invention to modern and diverse destinations. After the devastation of the COVID-19 pandemic, we believe the Autumn Budget paves the way for a successful 2022.