Britain’s largest supermarkets are staging an “outrageous” attempt to derail plans to ease business rates pressure on small retailers, alternative food retail network Better Food Traders has warned.
Last year, the government announced plans to introduce lower business rates for retail, hospitality and leisure properties with a rateable value below £500,000. Meanwhile, companies with larger premises, like the huge distribution warehouses used by Amazon, will pay higher rates instead. These changes are due to come into force in April 2026.
Next month’s Budget is expected to confirm these new business rate changes. Better Food Traders strongly supports this plan, seeing it as a positive first step to finally start to level the playing field between supermarkets and smaller, local shops.
However, the largest supermarkets including Tesco, Asda, Sainsbury’s and Morrisons along with Lidl, Aldi, Iceland, Waitrose and M&S have collectively signed a letter to Chancellor Rachel Reeves ahead of her Budget warning that households would “inevitably feel the impact” of any potential tax increases on the industry, such as higher business rates for supermarkets.
BFT’s Executive Director Julia Kirby-Smith appeared on BBC Evening News this week to refute their claims: “This letter is frankly outrageous. It’s another example of supermarkets shirking their responsibilities. Supermarkets like to talk about the narrow profit margins they make – that’s because they choose to spend vast amounts of money on marketing, especially for things like Ultra Processed Foods, and also on CEO pay. Supermarkets like to claim they’re the victims but actually they’re constantly squeezing farmers, squeezing workers and hollowing out the high streets that we need and value.”
BFT says the supermarkets’ letter fits with a history of major retailers painting themselves as victims of tough trading conditions, while in reality small, independent shops and traders have had to battle through the cost of living crisis often on the thinnest of margins – with many driven out of business.
BFT says the planned measures, if implemented fairly, could offer a real boost for small organic and local food businesses, allowing for some much needed breathing space to do what they do best – putting people and the planet first by:
- Supporting local farmers and growers
- Reducing food miles and waste
- Offering seasonal, nutritious food
- Keeping money circulating in the local economy
- Improving community cohesion
Read more about the benefits of a thriving local food economy in BFT’s latest report ‘Purpose Over Profit’
