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Britain’s Chancellor of the Exchequer, Rachel Reeves, signaled on Thursday that her government is exploring reforms to business property taxes aimed at helping smaller firms expand, as the country braces for its annual budget on November 26.
Reeves emphasized the need to ease sharp increases in property taxes—known as business rates—that can create financial hurdles when small companies grow.
“Our economy isn’t broken, but it does feel stuck,” Reeves said alongside a finance ministry report examining business property taxation.
“Tax reforms such as tackling cliff-edges in business rates and making reliefs fairer are vital to driving growth.”
The proposed measures could include smoothing out large jumps in rates, adjusting how taxes are calculated, and expanding reliefs for property improvements. Specific details will be unveiled in the upcoming budget.
Business reaction has been cautiously positive. Helen Dickinson, CEO of the British Retail Consortium, welcomed the focus on reform but stressed that clarity on promised reductions for retail, hospitality, and leisure businesses is critical.
“Until we get clarity on these changes, many local investments in jobs and stores are being held back,” she said.
Economists note that Reeves faces the dual challenge of boosting growth while raising tens of billions of pounds in revenue to cover higher borrowing costs, an uncertain growth outlook, and delayed welfare cuts. The proposed tax reforms are part of a broader effort to support small businesses while ensuring the government meets its fiscal targets.
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