The NFRN welcomes many aspects of Chancellor Hammond’s business – and environmental-friendly focus of the autumn budget 2017.
The Chancellor has listened to retailers’ concerns regarding recent business rates increases and their detrimental impact on local stores. Support for businesses affected by recent increases is badly needed, and the NFRN feels encouraged by the Government’s decision to provide an additional £2.3bn for struggling businesses. In particular, it welcomes the announcement of retrospective legislation addressing the “staircase tax” as well as the introduction of shorter rates revaluation periods.
However, despite these new policies aimed at supporting business communities, more needs to be done to drive growth and ensure independent retailers can survive in today’s competitive climate. The NFRN is very concerned about the Chancellor’s intention to increase the National Living Wage by 4.4 per cent from £7.50 to £7.83 in April 2018. While the NFRN is sympathetic to calls for a gradual increase, independent retailers cannot easily absorb the increasing costs that come with a higher National Living Wage. Retailers will be left with little options other than reducing staff working hours or reducing staff numbers in general to mitigate the additional financial burden. Already in 2016, the British Retail Consortium reported that rising costs to retailers could result in a
Furthermore, while freezing duty rates on beer, cider, wine, and spirits will alleviate financial difficulties in the short term, the announced 2 per cent increase of duty rates on all tobacco products will have severe negative implications for retailers, their customers, and the general public. The state has already lost approximately £31.6bn of tax revenue because of the illicit market in spirits, beers, and wine, cigarettes, rolling tobacco, and diesel. In recent years, the illegal tobacco market, in particular, has grown from 8 per cent to approximately 20 per cent in certain parts of the country. Higher duty rates will merely push more consumers towards illicit products and further strengthen the illicit tobacco trade, hurting retailers and the general public alike.
The Government has responded to retailers’ calls for further environmental policies. In the budget, the Government has committed to continue their ongoing assessment of possible waste reduction methods and has launched a call for evidence to collect views on how additional charges could reduce the quantity of single-use plastics waste. The NFRN has long supported further policies addressing waste reduction. Independent retailers want to do their bit to combat waste and protect the environment. The NFRN looks forward to contributing to the development of environmental-friendly policies.