Uniform Business Rate (Hansard, 4 February 1997)

§ 11. Mr. Whittingdale
To ask the Secretary of State for the Environment what assessment he has made of the impact of the uniform business rate on small businesses. [12511]

§ Mr. Gummer
Rates place a disproportionate burden on small businesses. For that reason, we have announced that rate bills for small business premises will not rise in 1997–98. We are looking at what other steps can be taken further to address this problem.

§ Mr. Whittingdale
Does my right hon. Friend accept that the burden of business rates bears particularly heavily not only on small businesses but on high-street retailers, who are trying to compete with out-of-town superstores? Is he aware that the Government's announcement that they are intending to redistribute the burden is particularly welcome to small shops such as those in Maldon high street? Will he assure us that he will introduce such measures as soon as possible after the general election?

§ Mr. Gummer
I can certainly give the assurance that, if we can find a more satisfactory and equitable way of doing these things, we shall do so as rapidly as possible. I am sure that my hon. Friend would like to extend what he said to the fact that village shops can now get the special mandatory relief—mandatory relief that Liberal Members voted against. They did not want local shops to get that relief as of right, but wanted to leave it in the hands of Liberal councils, which very often do not provide that relief.

§ Mr. Pike
Does the Secretary of State accept that we all recognise the importance of small business, but that, when he says that about the part of the poll tax legislation which refers to non-domestic rates, it really shows how that flagship legislation was flawed in both sections—in respect of non-domestic rates and of the poll tax—and shows what a disaster the Government have been since 1987?

§ Mr. Gummer
I must point out that the hon. Gentleman represents a party that used to set enormously high business rates and drove businesses out of its areas. For example, he will remember that, before we changed the rules, shopkeepers in Newcastle upon Tyne paid three times as much per square foot as people in Westminster, in Oxford street. That is what it meant to have a Labour council and Labour rates in those days—thank goodness we put that right.

§ Mr. Dover
Does the Minister accept that, in fact, probably the large majority of small businesses pay no uniform business rates, because they operate from residential homes? Is it not time that the Government considered scrapping all business rating for small businesses, in view of the arbitrary lines that separate those who pay and those who do not?

§ Mr. Gummer
My hon. Friend must accept that, wherever one draws those lines, one has such difficulties. I have suggested that we need to get the proportional weight of the business rate correct, which is why we are looking carefully, particularly at small businesses, to ensure that we can do what is best.