The Queen’s Speech on December 19 included the promise to ease the rates burden for the high street.
The 50% tax break applies to businesses with a rateable value below £51,000 and comes into force in April 2020, with an overhaul of the rates system promised in the March 2020 budget.
The discount will benefit dealers in certain parts of London and in other cities and towns but is unlikely to impact those dealers with premises in exclusive areas such as London's Mayfair district.
'A good thing'
Trade body leaders welcomed the move, which is a boost on the previous Tory government’s temporary 30% discount reprieve on business rates in 2018.
“The revaluation of business rates [in the past 10 years] has been one of the principal causes of the collapse of high street retail,” said Michael Cohen, chairman of BADA.
“It can only be a good thing that the government has now recognised that the policy of increasing business rates was regressive and destructive to small businesses.”
'Early Christmas gift'
Freya Simms, chief executive of LAPADA, described the government’s business rates discount commitment as “an early Christmas gift for LAPADA’s members, as is the promise of more frequent revaluation”.
Christopher Battiscombe, director general of the Society of London Art Dealers (SLAD) said he was "delighted" at the reduction in business rates for small businesses.
"The huge increase in business rates that have taken place over the last few years have been of considerable concern for many of our members and I hope that they will be able to benefit from the new proposals,” Battiscombe said.
Ten year campaign
Meanwhile dealers in Cecil Court, London, reacted with delight at the Queen’s Speech pledge. Ten years ago the street was cited by the then-Westminster MP, Mark Field, when he raised the issue of rates in parliament.
“This is good news,” said Tim Bryars of Cecil Court book seller Bryars & Bryars. “I have been campaigning on this issue for over 10 years now.
“The immediate reduction in business rates is great for me, but as the threshold is £51,000 I am well aware that many of my neighbours in London - for example on Charing Cross Road - will still be paying full whack.”
Bryars added: “I am far more excited about the complete overhaul to be announced in March.”
‘Too late for some’
However, there was a cautious tone to reactions to the rate cut news.
LAPADA's Freya Simms said the rate discount "is realistically a short term plaster on a long standing issue.
"We must focus on a bigger overhaul of the business rates system, providing stability and assurance to dealers who have suffered from the demise of the high street.”
BADA’s Michael Cohen said that since rates began to rise, “many dealers have closed their galleries and resorted to trading from home, fairs and online as the cost of running a gallery became unviable.
“I don’t imagine that dealers who have given up physical shops will now rush to find premises but this policy may well prevent further closures.”
Tim Bryars welcomed the fact that retail protests about rates “have come into the mainstream” but that a re-evaluation of rates would be “too late for some, I fear”.