Business groups say Tories plan to scrap business rates for the retail, hospitality and leisure sectors is “encouraging”, but reform of the entire system is needed to help all businesses.
Shadow Chancellor Sir Mel Stride told the party conference that his plan would benefit 250,000 businesses, though it was not clear if this includes firms north of the border as business rates are a devolved issue.
The tax relief would cost £4 billion a year and is funded from the £47bn that would be achieved in planned savings, a spokesperson said.
Sir Mel blamed “catastrophic” tax rises for creating an “economic time bomb” that will leave Britain poorer. “Britain must live within its means”, he said. “But we must give people hope and optimism”.
He warned that high levels of public spending will take Britain to a “very dark place” as welfare payments have “spiralled completely out of control.” He promised more than £20bn of savings
Sir Mel also made a pledge to first time home buyers, saying: “If you work hard and do the right thing, the Conservative party is on your side.
He announced that National Insurance on the first £5,000 of a person’s first job would go to a fund for buying their first home.
Speaking on television, he said the Conservatives are “the party of fiscal responsibility” and criticised the “serious mistakes” made during Liz Truss’s short tenure in Downing Street which “will never, ever happen again”.
Shevaun Haviland, director general of the British Chambers of Commerce said: “Fiscal responsibility is the bedrock of the economic growth we all want to see – and it’s important that all policymakers recognise that.
“The BCC has long argued for fundamental reform of business rates to create a system that is fair and affordable. While reviving our high streets is important, any changes to the rates system must go further and benefit businesses of all sizes.”
Rain Newton-Smith, CBI chief executive, said: “While plans to abolish business rates for hospitality, leisure and retail businesses could give high streets a boost, it’s more fundamental reform of a broken business rates system that is needed if we’re to incentivise the investment our country needs.
“Business will however be concerned by reactionary proposals to scrap key pieces of legislation, like the Climate Change Act, that have done much to boost confidence and underpin investment in high growth sectors.
“Firms will now want to a see a comprehensive, forward-looking vision for the economy focused on unlocking business investment.”
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