Tuesday, 27 October 2009

Major concerns over business tax

Plaid Cymru have called for a major re-think about the ways in which businesses are assessed for tax, following reports that many businesses are facing serious financial problems.

John Dixon, Plaid’s parliamentary candidate for Carmarthen West and South Pembrokeshire, said this week, “One of the biggest expenses faced by many town centre businesses is the rates bill. This is a particularly unfair form of taxation, since the level of charge bears no relationship to the profitability of the business.

“This means that two very similar businesses in similar locations will pay similar levels of rates – even if one of them is making a good profit and the other is making a loss. This can be the final straw for some businesses, and the economic recession is not helping. The tax also provides a direct disincentive to businesses who want to improve or extend their premises to improve their services to customers. Any business that does so will find that they are liable to get hit with an even bigger rates bill as a result. It is time for us to abolish this tax and replace it with a fairer tax which is related to the profits made by the business.”

The call was backed by one of the party’s councillors in Carmarthen Town. Cllr Alan Speake said, “I’ve been speaking to a number of business people in the centre of Carmarthen. They are telling me that they are having great difficulty in keeping their heads above water. The current town centre redevelopment isn’t helping either – many businesses are telling me that their takings have been down since St Catherine Street was closed and traffic into and out of town has got worse. They are worried that some customers may not return at all when the road re-opens.”

Plaid’s group leader on the county council, Cllr Peter Hughes Griffiths, said that he had written to the council’s executive board asking them whether there was any way that they could give some temporary exceptional rate relief to town centre businesses. He said, “We all know that things have been particularly difficult during the current redevelopment programme, and I think that it would be helpful if the council could consider any possible way of helping. After all, if businesses close, we’ll get no rates at all from them – it’s surely better to try and lower their costs and keep the businesses for the long term than to continue as things are and perhaps risk losing much more income.”

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