The high street has long been a hub of commerce and community, but in recent years, many have struggled to survive. One of the contributing factors to the decline of the high street is the business rates on empty shops. In this article, we will explore the impact of business rates on empty shops and how they have affected the landscape of our towns and cities.
Business rates are a tax that businesses pay on their commercial properties. The rates are calculated based on the rateable value of the property, which is determined by the government’s Valuation Office Agency. The local council then uses this rateable value to calculate how much the business will owe in business rates each year. This tax is a significant expense for businesses, and when a shop sits empty, the business rates still need to be paid.
The issue of business rates on empty shops is a contentious one. On one hand, it is argued that businesses should not be burdened with paying rates on a property that is not generating any income. This can be especially challenging for small businesses that are struggling to stay afloat. On the other hand, some argue that exempting empty properties from business rates could lead to landlords keeping properties vacant to avoid paying the tax.
One of the consequences of business rates on empty shops is the high vacancy rates on our high streets. As businesses close down or move to online platforms, more and more shops sit empty, unable to attract new tenants due to the high cost of business rates. This creates a cycle of decline, where the high street becomes a ghost town, with boarded-up shops and little foot traffic.
Another consequence of business rates on empty shops is the impact on local economies. When shops sit empty, it not only affects the businesses directly involved but also has a ripple effect on the surrounding businesses. Footfall decreases, and consumers have fewer reasons to visit the high street, leading to a decline in sales for all businesses in the area. This can have a devastating impact on the livelihoods of business owners and employees alike.
In recent years, there have been calls for reform of the business rates system to address the issue of empty shops. Some have proposed a temporary exemption for businesses that are struggling or have recently closed down, in order to give them a chance to regroup and reopen. Others have suggested that the government should offer incentives for landlords to fill empty properties, such as tax breaks or grants to help cover the cost of business rates.
One example of a successful initiative to address the issue of empty shops is the “Meanwhile Use” scheme in London. This scheme allows empty properties to be used for temporary purposes, such as pop-up shops, art galleries, or community spaces. By allowing these spaces to be used in the short term, it helps to revitalize the area and attract new businesses and customers. It also helps to reduce the burden of business rates on landlords, as the temporary tenants are often responsible for paying a reduced rate.
Overall, the impact of business rates on empty shops is undeniable. It is a complex issue that requires careful consideration and collaboration between businesses, landlords, and local governments. Finding a solution to the problem of empty shops is crucial for the future vitality of our high streets and the overall health of our local economies. By working together to address this issue, we can help to create a more vibrant and thriving community for all.