What it means for West End businesses
Chancellor's Autumn Statement 2022
Please see below for key updates for West End businesses from the Chancellor's Autumn Statement made earlier today in the House of Commons. Click here to read the full Statement.
The statement focussed on three key areas: stability, growth and public services. With forecasts predicting the economy will shrink by 1.4% next year, the Chancellor acknowledged that the UK is in recession, and that things will get worse before they improve.
Commenting on the Statement, Chief Executive Dee Corsi commented:
“Whilst we’re expecting a strong Christmas trading period, with £1.55 billion set to be spent in London’s West End alone, rising operating costs and in particular business rates, are squeezing already tight margins. We are concerned that the business rates package may not benefit all high street businesses, particularly those in the West End.
“We appreciate that the Chancellor needs to steady the economy, if we want to further our recovery in the face of a recession, we also need new growth measures.
"Reintroducing tax-free shopping for international visitors and lifting Sunday trading restrictions in London's two International Centres are simple ways to give retailers and the tourism sector a much-needed boost in the difficult times ahead. We urge the Chancellor to consider these seriously as part of a future growth package."
If you would like further information, please contact our interim Head of Communications Paul Barnes at email@example.com.
- The Government will reduce the business artes burden with an almost £14bn tax cut on business rates, benefitting around 700,000 businesses mainly in hospitality and retail. However, this is focussed on SMEs and is unlikely to impact on West End businesses.
- The Business Rate Valuation will proceed based on the April 2021 revaluation. There will be no transition period for any rate reductions, with Government funding the full cut in year one. This was a key New West End Company campaign aim.
- Following the recent consultation on an Online Sales Tax (OST), the government has decided not to introduce such a tax. The idea of an OST was put forward by certain stakeholders to “rebalance” the business rates bills paid by in-store retailers in comparison to their online counterparts. A response to the Online Sales Tax consultation will be published shortly.
- Click here for the full Business Rates Factsheet
WIDER BUSINESS MEASURES
- Employment allowance will be maintained at the higher level of £5,000.
- The Chancellor says businesses will be provided with additional support next year for cost-of-living.
- The “national living wage” will rise by 9.7% next year to £10.42 an hour.
- Tariffs will be cut to support business supply chains.
- Investment zones will be kept, centred on universities in “left behind areas” to help build growth clusters, with further announcements at the spring budget.
- Hunt says borrowing in the current financial year, 2022-23, will be 7.1% of GDP.
- Public sector net debt is forecast to peak at 97.6% of GDP in 2025-26, and then to fall gradually to 97.3% of GDP by 2027-28.
- Hunt announces two new fiscal rules: underlying debt must fall as a percentage of GDP within five years; and public sector borrowing must be below 3% of GDP.
- Windfall taxes will raise £14bn, including a new 45% levy on electricity producers.
- Energy, infrastructure and innovation will be priorities.
- The chancellor says he will double investment in energy efficiency of homes and industry by £6bn from 2025 and announced a new Energy Efficiency Taskforce.
- The chancellor says he will not cut capital budgets for the next two years, but then maintain them in cash terms for the next three years.
- The next round of the Levelling Up fund will at least match that of Round 1.
- He announced further devolution deals to support Levelling Up.
- Investment Zones are to be kept to build growth clusters, with further announcements to be made in the New Year.