By Liza Helps, Property Editor, Logistics Matters

BURNHAM HAD  said in the run up to his taking over the premiership on Monday that he was looking to raise business rates on warehouses to pay for a 20% cut for high street businesses – a move that was labelled ‘wrongheaded, damaging and stupid’.

Having listened to retailers, industrial and logistics developers, and UK logistics and business groups, he has indicated that the cut which would cost £100 million would be paid for by reducing tax reliefs for other high street businesses considered to cause social harm – typically vape shops. More detail is expected in the Autumn budget.

Responding to the Prime Minister’s announcement UK Warehousing Association Director of Policy, Edwin Morgan, said: “The Prime Minister has said in recent weeks that he would raise business rates on warehouses in order to pay for a cut for hospitality venues. We very much hope that [this] announcement is a sign that he has listened to our sector and will not seek to load the burden on warehouses, which have already seen substantial increases this year.

“Our members store and distribute the food, drink and other goods that are essential to pubs and music venues the Prime Minister is trying to support. You can’t have a vibrant town centre without a successful logistics sector supplying everything it needs to function.

“We look forward to engaging with the Government as the details become clearer. Warehousing makes a significant positive contribution in terms of jobs and supporting local businesses, and we hope will be seen as a valuable partner in Andy Burnham’s drive to spread growth to all parts of the UK.”

Global tax firm Ryan’s Practice Leader for Europe and Asia-Pacific Property Tax, Alex Probyn, added: “It’s welcome that the Government has stepped away from funding the policy through higher business rates on warehouses. Most distribution warehouses support manufacturers, supermarkets and wider UK supply chains rather than online-only retail, and have already seen substantial increases in business rates over the last two revaluation cycles. Avoiding further tax increases on a sector operating on tight margins reduces the risk of higher costs ultimately feeding through to consumers.”