Restaurant chains and rates rise and Brexit

Meeting: 
MQT on 2017-01-18
Session date: 
January 18, 2017
Reference: 
2017/0210
Question By: 
Andrew Dismore
Organisation: 
Labour Group
Asked Of: 
The Mayor

Question

In a letter to the Evening Standard, chief executives of London's most popular restaurant chains have demanded that the Prime Minister ease the burdens caused by rising business rates, taxes and the weak pound. They say London's restaurant chains are being squeezed as never before and need some respite, particularly from the huge hike in business rates.  Will you support them in their call for help?

Answer

Answer for Restaurant chains and rates rise and Brexit

Answer for Restaurant chains and rates rise and Brexit

Answered By: 
The Mayor

I appreciate the challenges posed by business rates, taxes and the weak pound on restaurant chains as well as other businesses in London. As a result of the 2017 revaluation business rates bills in London will increase by around £1 billion or 11% - the only English region seeing an increase.

 

I, alongside other arms of London Government and London business, campaigned to get the Government to improve the transitional relief scheme offered to business ratepayers and was successful in achieving this: the cap on bill increases for large ratepayers went from 45% to 42% in 2017-18 with a bigger reduction on the cap in 2018-19 from 50% to 32%. These changes - albeit limited - will save London businesses around £75 million over the next two years.

My efforts have reduced the burden on London business that could have materialised; however, the Government's transitional relief scheme which caps maximum increases in actual bills next year at 42% and 130% over the next 3 years for larger ratepayers is still very unfair and aggressive.

In order to ensure this is never repeated again we need full devolution of the administration of business rates to London including local control of revaluations and a separate London arm of the Valuation Office. Such devolved arrangements already operate successfully in Scotland, Wales and Northern Ireland.

 

I reconvened the independent London Finance Commission last year to assess the tax powers London needs to support economic growth across the capital and to call on Government to devolve the powers to London that are needed to bring an end to events like this huge increase on London ratepayer's bills. The Commission will report later this month.