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East Midlands Chamber News

Chamber Urges Caution Over Business Rates Reform

Chancellor George OsborneLocal authorities will be allowed to keep all of the revenue they raise from Business Rates under a radical new proposal announced by Chancellor George Osborne today.

Mr Osborne told the Conservative Party Conference in Manchester that the move, which will see councils take full control over the £26bn raised by Business Rates each year, will be the “…biggest transfer of power to our local government in living memory”.

He said his Government will “…abolish the uniform business rate – the single, national tax rate imposed on every council – entirely”, meaning that “…any local area will be able to cut business rates as much as they like, to win new jobs and generate wealth.”

Chris Hobson, Director of Policy at East Midlands Chamber*, said: “This significant departure from the current system of business taxation has the potential to be a game-changer.

“The Chamber, on behalf of its members and the wider business community here in the East Midlands, has long called for a radical shake-up of rules governing Business Rates.

“However, given the lack of consultation from Government on this proposal, the details of this new plan will be critically important. At a time when the Chancellor is promoting a national rebalancing of growth, we need to ensure that London and the South East don’t end up being the major beneficiaries of any changes.

“The direct relationship between strong, vibrant local businesses and a flourishing wider community is clear, so it is of vital importance that the business voice is central to all discussions about the level at which future rates are set and how the revenue they raise is spent.

“Firms will not accept taxation without representation and will want assurances that greater local control over business rates will not translate to them being seen as a cash cow for local government.

“Implemented in partnership with the business community, these changes could support opportunities for sustainable growth. Any other approach would risk fatally undermining the long-term success of a locality and, ultimately, the people who live in it.”

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