What every small business wants for Christmas: the tax cut Labour promised…

Russell George says a Small Business Charter is needed to boost SMEs and improve footfall on our beleaguered high streets

For several years the Welsh Conservatives have been calling on the Welsh Government to cut rates for small businesses, publishing our vision for the Welsh High Street in October 2012. 99% of all Welsh firms are SMEs, and if each one were able to take on just one extra employee, unemployment would be wiped out at a stroke.

They are the lifeblood of our economy, the backbone of our High Streets – and yet, for many years they have been let down by the Welsh Labour Government.

With the power to alter rates having been devolved since 2015, it’s inexplicable that small Welsh firms are still waiting in limbo for a permanent scheme. And yet, many small businesses would have been heartened by Labour’s promise (during the Assembly elections) to cut their rates…

Sadly, that pledge has not been kept. The thresholds for rate relief have not changed, and even the normally measured FSB Wales called Labour’s recent announcement: “spin doctoring of the worst kind”.

To be frank, many businesses face a bleak future. My colleague Nick Ramsay recently highlighted a letter he’d received from a Monmouth business inviting him to attend their ‘closing down party’.

Indeed, the recent revaluation debacle has highlighted the plight faced by many small firms as a result of Labour’s business rate betrayal. But also as a result of their failure to plan properly for the revaluation process.

It has become abundantly clear that the Welsh Government were ill prepared for the revaluations, and that the system simply doesn’t have the capacity to handle the volume of challenges from firms who have been hit with by substantial increases.

In the long run, we want to see business rates abolished for all firms with a rateable value of less than £12,000. Most pressing, however, is the need to provide the transitional fund with additional money to support those firms who have been worst affected with their first rates bill in April 2017. At the very least, the Labour Government must take steps to provide SMEs with a soft landing when the revaluations come in to force.

It’s clear that many of our smallest companies will go under without additional support, and that’s why I am calling on the Cabinet Secretary to provide an end to the uncertainty and worry ahead of Christmas.

We’ve also called for a Small Business Charter to help Wales’ smallest firms.

  • Abolish business rates for all small businesses and taper relief on rateable values between £12,000 to £15,000
  • Guarantee and prioritise better access to the public procurement process for small business in Wales
  • Deliver universal super-fast broadband and mobile coverage across Wales by 2019
  • Devolve key economic levers to local communities and ensure easier access to finance
  • Promote free town centre parking

The Welsh Government has an opportunity to put things right, and our Small Business Charter contains a number of practical measures to boost SMEs and improve footfall on our beleaguered high streets.

Russell George is the AM for Montgomeryshire, and currently serves as the Welsh Conservative spokesman for the Economy. He also chairs the Assembly’s Economy, Infrastructure & Skills Committee.

One thought on “What every small business wants for Christmas: the tax cut Labour promised…

  1. Much I would agree with, but I would argue that transitional rates relief hurts businesses in the poorer parts of Wales and helps businesses who are doing well.

    It’s been seven years since the last revaluation (usually 5) which means that some businesses have been paying higher rates for two years and others are now faced with large increases in their rateable value.

    I’ve spoken to dozens of businesses in the last few weeks who have had 30% increases in their rateable value and as a result are pushed over the 12k threshold for rates relief. Other businesses have been overpaying for two years and will only have a reduction in their rates from next year.

    Businesses are still paying rates based on 2008 values and before the property crash. Seven years, I would argue, is far too long to wait for a revaluation.

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