Reforming the business rates system

The challenge businesses are facing

Business rates are complex, unpredictable and inequitable. The cost burden has risen further following the announcement in the 2023 Autumn Statement to increase the standard multiplier.

Many businesses – including 46% of retailers – say that they would have no choice but to pass on the business rates cost increase in full.

In addition, the time taken to announce rateable value changes following revaluation makes it hard for businesses to forecast and plan around, the multipliers for business rates across the UK are punitive, and the patchwork approach to exemptions and reliefs has created an overly complex system to comply with.

What the CBI is asking for

The business rates system, introduced in the 1990s in its current form, represents a growing financial and administrative burden, and one that has not managed to adapt to new ways of working (for example e-commerce and working from home arrangements). The way it seeks to raise the same amount every year for government in real terms, despite a shrinking base, creates significant business uncertainty and acts as a barrier to investment. Put simply, a legacy tax cannot support a modern, growing economy.

We're calling on the government to prioritise business rates reform that ends the unpredictable cycle of rate increases and reduces the overall burden of the system ahead of the next revaluation in 2026.

Our 2024 Business Rates Reform Project has brought together businesses most affected by business rates to deliver policy solutions that set a clear path forward for the next government.

How to get involved

Join our Business Rates Working Group, where professionals with expert knowledge of business rates converge to shape policy and influence government decisions. Whether you're a seasoned expert or a senior advisor, your insights are crucial in reforming the business rates system and driving impactful change.

You’ll be able to stay ahead of developments in business rates and collaborate to form policy positions that influence government decisions. We engage with key stakeholders such as HMT, HMRC, the Department for Levelling Up, Housing and Communities, and the Valuation Office Agency (VOA) to advocate for reforms that benefit businesses across the board.

If you're a CBI member, contact Rahim Mohamed to join the Business Rates Working Group.