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FSB: Rates relief scheme must be extended

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24th Jan 2005
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The Federation of Small Business (FSB) has warned that the government "must extend its rates relief scheme" if small businesses are not to suffer "disproportionately" from business rates."

In a statement, the FSB has said that "Small firms feel the pinch of business rates more sharply than larger firms" and said that, "For a business with a turnover £50,000, business rates represent 7.7% of sales, but for those with a turnover of £500,000 it is 1.4%."

The FSB says the 2005 business rates revaluation "looks set to compound the problem with high increases in rateable values for retailers, and especially those in affluent areas."

By way of illustration, the FSB points out that a shop in the South East of England faces an average 29 per cent increase in its rateable value, and that this could entail an "increase of about £1,800 in the final rates bill." By contrast, says the FSB, "a factory in the West Midlands can look forward to a 6 per cent rateable value increase, which actually represents a reduction of £150 in their rates bill."

While acknowledging that there would be no changing 2005's rate changes, Stephen Alambritis of the FSB told AccountingWEB: "It's a real concern that while the high street is doing well, their rents go up, therefore their rates go up. We really do believe'rate relief could be more generous - it would be a mark of commitment to small business."

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