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New PM must fix business rates to save High Street says Iceland boss

One of Britain’s biggest retailers joins call for Tory leadership candidates to prioritize shaking up ‘obsolete’ corporate tariffs

  • Icelandic boss Richard Walker urged next prime minister to pledge ‘root and branch’ reforms
  • Walker said the levy will penalize brick and mortar retailers
  • His intervention follows similar appeals from the Retail Jobs Alliance

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One of Britain’s largest retailers has joined the call for Tory leadership candidates to prioritize a shake-up of ‘outdated’ corporate rates.

Icelandic boss Richard Walker urged the next prime minister to promise a ‘root and branch’ tax reform.

He said the levy would hurt brick-and-mortar retailers and that without a fundamental change, the High Street would “continue to fall.”

Plea: Iceland boss Richard Walker urged next prime minister to pledge 'root and branch' tax reform

Plea: Iceland boss Richard Walker urged next prime minister to pledge ‘root and branch’ tax reform

His intervention follows similar calls from a consortium of retailers – the Retail Jobs Alliance (RJI) – including Tesco, Sainsbury’s and B&Q owner Kingfisher.

RJI members employ more than a million people, a third of all industry jobs. And last week it accused Rishi Sunak and Liz Truss of “not prioritizing the high street.”

Business rates are based on rental value, not profit. Walker said reform is especially important as pressured shoppers turn to discount stores such as Iceland, which has nearly 1,000 stores in the UK.

Iceland has locked in the price from its value range from £1 to 2023, meaning it is now selling the products at a loss.

Walker said: ‘Our corporate rate bill is well over £40 million a year. It’s just unfair. You have huge online companies that are free to hitch a ride.’

He pointed out that online giants benefit from the same infrastructure as brick-and-mortar retailers, but don’t pay a fair share of the tax it finances.

Walker said the corporate rate reform would also encourage more retailers to open businesses. This would breathe new life into the city and city centers. Frontrunner Truss, the foreign minister, has pledged “to cut taxes from day one” if she becomes prime minister, while former chancellor Sunak would eliminate VAT on fuel.

He has avoided otherwise promising tax cuts, but over the weekend unveiled a plan to revitalize high streets and reduce shuttered stores.

Walker said candidates should focus on corporate rates as they will have a greater impact on jobs, productivity and leveling.

He added that companies were happy to repay the government’s generosity after being helped by the pandemic.

Walker said: ‘I think it’s right that we say that a corporate tax increase of a few percentage points is not a bad thing.

“In return, it’s definitely about jobs, productivity, leveling and shopping streets that need reform.”

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