Tesco and Sainsbury's have warned that Rachel Reeves could speed up high street decline. (Image: Getty)
Bosses of two of the UK's biggest supermarkets have warned that Rachel Reeves could threaten the high street with fresh tax raids. The Chancellor is expected to change the current business rates system in her next Budget, which is expected to leave department stores and supermarkets with higher tax bills.
Ministers argued that making bigger businesses pay more to reduce the fees for smaller ones would target online retailers and save independent shops. However, Tesco CEO Ken Murphy said the move would only add pressure to already struggling high streets and town centres. He said: "Increasing the burden on large shops would hinder rather than help our town centres. Many of these shops are anchor stores in their local communities."
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Tesco boss Ken Murphy warned of the effects of changing business rates. (Image: Getty)
Simon Roberts, Sainsbury's CEO, warned that shaking up business rates would force large companies to "pull away from our high streets".
He told The Telegraph: "The changes being proposed will further increase the negative impact of business rates and won’t stimulate the growth or investment into our high streets and jobs that we all want to see.
"The Government promised fundamental reform to level the playing field but the changes we are hearing about will not deliver this – they will not stimulate growth or investment."
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Alex Baldock, CEO of Currys, slammed Ms Reeves for "rushing" the proposed changes to business rates, warning of knock-on effects for retailers already struggling to stay afloat.
He warned that the changes would "shutter more stores" and "leave more gaps on the high street".
Mr Baldock said shops already find themselves amid "a perfect storm" of "extra costs and red tape", which is "bad for jobs, investment and growth". The retail boss added: "The mooted hikes in business rates will just make things worse."
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The British Chambers of Commerce has already warned that businesses are being "paralysed" by taxes, with one in three slashing jobs following the employers' National Insurance Contributions increase.
A Treasury spokesman said: "We are a pro-business Government that is creating a fairer business rates system to protect the high street, support investment and level the playing field.
"To deliver our manifesto pledge and provide certainty and support to the high street we intend to introduce permanently lower tax rates for retail, hospitality and leisure properties from next year."
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