Big Four grocers to get £173m business rates reduction on larger stores

THE big four grocers are to receive a £173m tax reduction on their larger stores over the next five years following the Government’s business rates revaluation.

Asda, Morrisons, Tesco and Sainsbury’s and others are set to see their rateable values for their superstores in England and Wales slashed next year by £173m, according to business rent and rates specialists, CVS.

This year, 2,172 superstores have been revalued at a collective £2.761bn in rateable value, compared to £2.934bn from the 2010 assessment which formed the basis of tax bills for the last seven years.

The average superstore will see its rateable value fall by 5.9%, or £79,368 and the Government has indicated that the multiplier will also fall by 3.4% reducing by 1.7p. But the proposals for transitional relief, which limits big increases and decreases in rates, could effectively cap reductions at 4.1% for these stores.

Mark Rigby, chief executive of business rent and rates specialists CVS, said: “There’s no doubt that the new Rating List will be welcome news for Britain’s largest supermarkets.

“Falling shop prices are causing enormous cost pressures for retailers. There is no doubt that had the revaluation not been delayed by two years, the Big 4 would have been hit hard. With the loss of market share and the proliferation of new stores by the discounters, undoubtedly, this will be good news.

“However, the Government’s proposals for transitional rates relief mean that those businesses expecting lower bills will only get those savings gradually – so firms will have to wait even longer for their long-awaited relief.”