Welsh companies say rising business rates are a hurricane on the high street

Traders in Bangor, Gwynedd, said rising costs were starting to take effect.

“It has the longest high street in all of England and one of the least crowded high streets in all of England,” said Sophia Ingham, a clothing designer and home decor seller.

Since July last year, she has been running the Fia store in the Dayniol Shopping Center, but she expects she will have to close this summer “due to all the interest rate hikes”.

This will be the last store to close in Bangor.

“Most of the shops are closed or boarded up,” Ms Ingham said.

She called on the government to cut rates completely “to help revitalize high streets, rather than abolish them”.

Business rates, also known as non-domestic rates, are taxes based on the rateable value (RV) of the property being occupied.

So, for example, if you’re a business with a 15,000 pound RV, you’d multiply that by 0.562. This means your bill will be £8,430.

Fees are collected by local authorities and paid into the Welsh Government’s National Fund.

The Welsh Government decides what discounts or relief certain businesses are entitled to.

In April, relief for retail and hospitality businesses fell from 75% to 40%. Similar companies in the UK continue to receive 75% relief.

The Welsh Government said it was continuing to offer retail and hospitality businesses £78m worth of discounts on business rates.

But groups representing hotels, pubs and restaurants said the sector was under huge financial strain.

“This is not just a perfect storm, it’s a perfect hurricane,” said David Chapman, executive director of British Hospitality Cymru.

“There are forced closures due to COVID-19, energy prices are high, and food and beverage inflation is high. We don’t have cash on hand and are repaying our COVID-19 loans.

“The only support we had was business rates relief, but that was taken away from us,” he said.

Mr Chapman called on the Welsh Government to restore the relief amount to the previous level, which is equivalent to the discount in England.

Andrea Thomas runs Dot Clothing Shop in Llandeilo, Carmarthenshire, selling imported European fashion brands to customers in the rural market town.

He said the increase in business rates was “a bit unfair” when similar shops in the UK were paying lower rates.

“We have to pay more than [businesses] “In the UK the people crossing the bridge have to pay, but the running costs there are probably about the same,” she said.

Thomas also sells clothing online, but wants to stay on the high street.

“Any additional costs will affect how much profit you can make, and obviously I would like to continue with brick-and-mortar stores and window shops, but online is becoming cheaper and cheaper to operate.

“So offering low-cost business rates has a huge impact on keeping us locals local.”

The Welsh Government said it was “doing everything we can with the resources and powers available” to provide support to businesses.

“We are offering a range of permanent overseas rates relief for businesses worth £250 million a year, fully funded by the Welsh Government.

“This includes small business rates relief that will support ratepayers in around 70,000 accommodation properties across Wales, of which more than two-thirds pay no rates at all.

“We will provide an additional £134 million worth of non-domestic rates support in 2024-2025, including a fifth consecutive year of rate bill support for retail, leisure and hospitality businesses. 1 billion in interest rate relief for these sectors in 2020-21, at a cost of around £78 million.

“This year, only 1 in 5 properties are obligated to pay their full bill.”