Scrap HFSS, continue rate relief and rethink National Insurance Contribution: ACS to Chancellor

Association of Convenience Stores (ACS) in its recommendations to the Chancellor ahead of the Spring Statement has called on the government to continue business rate relief, scrap upcoming HFSS regulations and crackdown on illicit tobacco and alcohol trade in a bid to support local shops

In a statement released on Friday (18), ACS has raised the demand of protecting local shops from rising costs and the looming reintroduction of business rates bills.

The support provided by the government on business rates over the last two years has enabled thousands of stores to continue trading and serving their communities, but the UK is far from operating at ‘normal’ pre-Covid levels. To continue supporting local shops, ACS is recommending that the Treasury, at a minimum, should continue the existing business rate relief of 66 percent for retail businesses for another 12 months to April 2023.

ACS has also welcomed the Government’s active consultation on the introduction of an online sales tax to rebalance the contribution of online and bricks and mortar businesses. However, universal sales taxes should not be seen as a viable replacement for the business rates system, as they hit lower margin businesses like local shops the hardest.

Local shops are facing into a year which will be dominated by rising costs. The cost of energy, the cost of employing people and the cost of upcoming regulations add up to tens of thousands of pounds that retailers are going to have to find from somewhere. To lessen the blow on the cost of employment, ACS has called on the Government to rethink the planned increase in employer national insurance contributions.

On upcoming regulations, ACS has highlighted the £92m implementation cost of proposed rules restricting the promotion and placement of high fat, salt and sugar products in convenience stores, as well the millions of pounds allocated to arm enforcement officers with tape measures to check businesses are compliant from October. ACS has called on the Government to scrap these proposals and instead invest the cost of enforcement in cracking down on the illicit alcohol and tobacco markets that cost retailers and the Government billions every year.

ACS chief executive James Lowman said, “Our recommendations to the Government set out a comprehensive set of measures that would provide real support to local shops at a time when many are considering whether they will still be able to keep the lights on in 12 months’ time. This is not the time to be heaping additional costs onto retailers – this is the time to create the conditions to ensure that retailers and their colleagues can continue serving their communities and play their part in the UK’s long term recovery from the economic shock of the last two years.”

Additional measures recommended in the submission to the Treasury ahead of the Spring Statement include:

• Freeze alcohol and tobacco duties to avoid driving consumers to the black market and away from responsible retailers
• Freeze fuel duty to help consumers and businesses with the cost of getting around
• Freeze the business rates multipliers for the financial year 2023/24
• Remove VAT from deposit return scheme deposits and encourage investment in reverse vending machines through rates exemptions and permitted development rights
• Give the Low Pay Commission the freedom to set minimum and living wage rates independently of political targets after the 2/3 median earnings target has been reached in 2024