The British Independent Retailers Association (Bira) has stepped up its pressure on Chancellor John Healey to use the 28 October Budget to cut business rates and employment costs for small shops, warning that the government’s growth ambitions will stall on the high street unless they translate into lower operating costs. In a statement reported by Retail Insight Network on Monday morning, Bira chief executive Andrew Goodacre welcomed the Chancellor’s 7 September growth speech but said independent retailers now need “a real reason for hope” rather than “further reviews and roadmaps”.
The intervention lands six weeks before Healey delivers his first Budget under Prime Minister Andy Burnham. It also follows a run of warnings from the Association of Convenience Stores, Enterprise Nation and the Federation of Small Businesses about the cost of trading, which together make business rates the single most contested line in the retail lobby’s Budget submissions. This article sets out what Bira is asking for, what the rates system actually looks like in 2026/27, what Healey has and has not committed to, and what a typical shop’s bill could look like under each scenario.
In short
- Bira, which represents more than 6,000 independent retailers, is pressing Chancellor John Healey to act on business rates and employment costs at the 28 October 2026 Budget, according to Retail Insight Network and Talking Retail.
- The association’s headline ask is the restoration of the 75% retail, hospitality and leisure discount (capped at £110,000 per business) and a guarantee that no independent retailer faces a higher rates bill next year.
- Its six-point submission also calls for the Employment Allowance to rise to £20,000, low-value import reforms to be brought forward to 2027, tougher VAT enforcement on overseas sellers, sustained neighbourhood policing and cheaper town-centre parking.
- Since 1 April 2026, qualifying retail properties pay permanently lower multipliers of 38.2p and 43p, but the old percentage discount has ended, so many shops with mid-sized rateable values are paying more than they did under the 40% relief in 2025/26.
- Healey has promised a 25% cut in the regulatory burden and a roadmap for local business rates retention from 2028, but has warned the Budget “could be tough” as the Middle East conflict pushes up inflation and borrowing costs.
What has Bira actually said to the Chancellor?
Bira’s latest statement is a direct response to the growth speech Healey delivered at the Manufacturing Technology Centre on 7 September. In that speech the Chancellor confirmed a commitment to reduce the burden of business regulation by 25% by the end of this Parliament, and said the Budget would set out a roadmap for greater business rates retention by local councils and strategic authorities as part of a wider programme of fiscal devolution.
Goodacre’s reaction, first carried by Talking Retail on 8 September and picked up by Asian Trader and Retail Insight Network in the days since, was carefully worded. “We welcome the chancellor’s focus on growth, and we share his ambition to deliver sustained growth for the UK economy,” he said. “Independent retailers want to play their part in that growth, and growth that is spent with British based businesses is the kind that will benefit the high street most directly.”
The sting came in the next lines. “The chancellor himself accepts that he must draw a line under the rising cost of doing business,” Goodacre said. “We now urge him to use the upcoming Budget to give independent retailers in every postcode real reason for hope, by acting on business rates and the cost of employment.” Bira added that its members would be watching closely to see whether the Budget delivers “meaningful reform, rather than further reviews and roadmaps”.
The “every postcode” phrasing is deliberate. It echoes the government’s own language: when Healey announced the Budget date on 31 July he said it would “move money and power out of Westminster, and into every postcode around Britain”. Bira is, in effect, holding the Chancellor to his own slogan.
What are the six Budget asks, in detail?
Bira’s formal submission, published in mid-August and reported by Retail Insight Network on 14 August, sets out six demands. The Treasury’s Budget Representation Portal closed on 9 September, so the association’s position is now on the record with officials. The table below summarises each ask alongside the current position.
| Bira ask | Current position (2026/27) | What Bira wants |
|---|---|---|
| Retail, hospitality and leisure rates relief | Percentage discount ended in April 2026; replaced by permanently lower RHL multipliers (38.2p and 43p) | Restore the 75% discount with a £110,000 cash cap; guarantee no independent retailer pays more next year |
| Employment Allowance | £10,500 per eligible employer | Raise to £20,000 |
| Low-value import (customs) reform | Planned for October 2028 | Bring forward to 2027 |
| VAT enforcement on overseas sellers | Ongoing HMRC compliance work | Firm action against non-compliant overseas sellers by April 2027 |
| Retail crime | Police-recorded shoplifting 507,086 offences in England and Wales, year to March 2026 (down 4%) | Maintain investment in community and neighbourhood policing |
| Town-centre parking | Set locally by councils | A national approach to lower parking costs |
Business rates: the 75% relief and the “no higher bill” guarantee
The first and most expensive ask is to bring back the 75% discount that applied to qualifying retail, hospitality and leisure properties in 2024/25, subject to the same £110,000 cash cap per business (about USD 148,750 at the current rate of 1.35). That discount was cut to 40% for 2025/26 and then withdrawn altogether from April 2026 when the new permanent multipliers took effect. Bira pairs the ask with a simpler test: no independent retailer should face a higher business rates bill in 2027/28 than in 2026/27, whatever the mechanism.
Employment Allowance: from £10,500 to £20,000
The Employment Allowance lets eligible employers knock a fixed sum off their annual employer National Insurance bill. It rose from £5,000 to £10,500 in April 2025, at the same time as the employer NIC rate went to 15% and the threshold at which it starts fell to £5,000 a year. Bira argues that the higher allowance did not fully offset the extra NIC cost for a shop with a handful of staff, and wants it doubled again.
Imports, VAT and the overseas-seller problem.
The third and fourth asks target the flood of low-value parcels from overseas marketplaces. Bira wants the government’s planned reform of customs treatment for low-value goods brought forward from October 2028 to 2027, and wants HMRC to take firm action by April 2027 against overseas sellers that do not comply with UK VAT rules on imported goods. Both are framed as fairness measures: a bricks-and-mortar shop pays rates, VAT and employer NIC on every sale, while a parcel shipped direct from an overseas warehouse may pay none of them.
Policing and parking.
The final two asks are about footfall and safety rather than tax. Bira wants continued investment in neighbourhood policing to tackle shop theft and anti-social behaviour, and a national approach to lowering town-centre parking charges. The association cites Home Office figures showing police-recorded shoplifting in England and Wales fell 4% to 507,086 offences in the year to March 2026, from 530,324 the year before, but argues the figure remains historically high and that many incidents go unreported.
How does the business rates system work in 2026/27?
To understand why Bira is pushing so hard, it helps to see what changed on 1 April 2026. Two things happened at once: England’s business rates revaluation took effect, resetting every property’s rateable value, and a new set of multipliers replaced the temporary percentage discount that shops had relied on since the pandemic.
Under the new structure, qualifying retail, hospitality and leisure properties with rateable values below £500,000 pay multipliers set 5p below the national equivalents. For 2026/27 that means 38.2p in the pound for qualifying properties with a rateable value under £51,000, and 43p for those between £51,000 and £499,999, according to government guidance and figures cited by Retail Insight Network. The government estimates that more than 750,000 properties benefit from the lower rates.
To pay for the cut, the government introduced a higher multiplier of 50.8p on all properties with a rateable value of £500,000 and above, set 2.8p above the standard multiplier. The government’s own effects analysis says the lower RHL multipliers should save more than 35,000 pubs an estimated £210 million and nearly 30,000 restaurants an estimated £180 million over 2026/27 to 2028/29. Crucially, the new multipliers are permanent and carry no cash cap, which the government presents as a gain in certainty over the old annual relief.
Why a lower multiplier can still mean a higher bill
The problem, as trade bodies including the ACS have documented, is arithmetic. A 5p cut in the multiplier is worth roughly a 10% reduction in the bill. The 40% discount it replaced was worth four times that, and the 75% discount before it was worth seven times that. For a shop whose rateable value did not fall sharply at the revaluation, the April 2026 changeover therefore produced a higher bill, not a lower one. The ACS Local Shop Report 2026 found that the convenience sector’s aggregate rates bill has nearly doubled in two years for exactly this reason.
Small Business Rate Relief still removes the bill entirely for properties with a rateable value under £12,000 and tapers it away up to £15,000. But the typical high-street shop unit in a market town sits above that threshold, in the £15,000 to £51,000 band where the 38.2p multiplier applies in full and no percentage relief remains.
What would each scenario cost a typical shop?
The table below models a single retail property with a rateable value of £20,000, which is a common figure for a mid-sized unit outside London. It assumes the rateable value is unchanged across years so that the effect of the policy, rather than the revaluation, is isolated. Figures are gross of any transitional relief and are illustrative rather than a quote from a billing authority.
| Year and regime | Multiplier | Gross bill | Relief | Net bill |
|---|---|---|---|---|
| 2024/25 (75% RHL relief) | 49.9p | £9,980 | 75% | £2,495 |
| 2025/26 (40% RHL relief) | 49.9p | £9,980 | 40% | £5,988 |
| 2026/27 (new RHL multiplier) | 38.2p | £7,640 | None | £7,640 |
| 2027/28 if Bira’s 75% ask were granted | 38.2p | £7,640 | 75% | £1,910 |
On these assumptions the shop’s rates bill rose by about £1,650 between 2025/26 and 2026/27 despite the “permanently lower” multiplier, and sits more than £5,000 above where it was two years earlier. Restoring a 75% discount on top of the new multiplier would cut the bill to roughly £1,900, which is why Bira regards that ask as the one that would move the needle for its members. The Treasury’s objection is equally clear: the 75% relief cost several billion pounds a year at its peak, and the government has said the Budget must meet its fiscal rules with a buffer.
The employment cost side of the ledger
Rates are only half of Bira’s cost argument. From 1 April 2026 the National Living Wage for workers aged 21 and over is £12.71 an hour, the 18 to 20 rate is £10.85, and the rate for under-18s and apprentices is £8.00, according to HMRC’s rates and thresholds guidance for 2026 to 2027. Employer National Insurance is charged at 15% on earnings above £5,000 a year, and the Employment Allowance is £10,500.
For a shop with five full-time staff on the National Living Wage working 37.5 hours a week, annual pay is about £24,785 per person. Employer NIC on that is roughly £2,968 per person, or about £14,840 across the five. After the £10,500 Employment Allowance the shop pays around £4,340 in employer NIC. If the allowance rose to £20,000 as Bira proposes, that bill would fall to zero, and a shop with up to six or seven staff on the living wage would also pay nothing. That is the practical effect Bira is asking for, and it is why the association pairs the rates ask with the allowance ask rather than treating them separately.
What has Healey committed to, and what is still open?
The Chancellor’s growth speech contained two commitments that bear directly on shops, and one important silence. The first commitment is the 25% reduction in the burden of business regulation by the end of the Parliament. The second is the fiscal devolution roadmap, under which mayoral strategic authorities will move towards retaining more of the business rates raised in their areas, with local income tax shares replacing central grants from 2028.
The silence is on the level of business rates themselves. Healey has said nothing so far about restoring a percentage discount, changing the multipliers or adjusting the £500,000 threshold for the higher rate. He did, however, tell the audience at the MTC that he must “draw a line” under rising costs for businesses, a phrase Bira has seized on and repeated back to him.
The fiscal backdrop: a “tough” Budget
The broader context is not encouraging for anyone hoping for a large giveaway. On 5 September Healey told LBC that the autumn Budget “could be tough” because of the economic effects of the conflict in the Middle East. “What’s happening in the Middle East is hitting inflation, it’s hitting growth, it’s hitting borrowing costs,” he said, adding that he wants the UK to emerge from 28 October with a “solid buffer against uncertainty”. Government borrowing costs rose sharply in the first week of September as lenders priced in the inflationary impact of the conflict.
The Treasury’s fiscal rules require the current budget to be in surplus by the end of the Parliament, and Healey has declined to rule out tax rises. Economists quoted by LBC expect the fiscal headroom built up by his predecessor Rachel Reeves through tax rises and spending restraint to be squeezed by global inflation. Against that backdrop, a return to a 75% rates discount worth billions of pounds looks like a long shot, and even Bira’s “no higher bill” guarantee would require new money.
Where devolution cuts both ways
The rates retention roadmap is the piece of Healey’s plan that independent retailers view with most suspicion. In principle, letting councils keep more of the rates they collect gives them an incentive to fill empty units and grow the local tax base. In practice, Bira and others fear it locks in a high tax on physical property as the funding base for local services, making future cuts politically harder because every pound off a shop’s bill is a pound off a council’s budget. The association raised the same concern last week over the new mayoral tourist tax powers, arguing that money raised on the high street should be spent on it.
How does Bira’s position compare with other retail bodies?
Bira is not lobbying alone, and the Chancellor is receiving a broadly consistent message from across the sector, though with differences of emphasis that reflect each body’s membership.
The ACS, which represents convenience stores, has focused on the cumulative cost of trading and the collapse in investment, reporting that its members’ aggregate rates bill has nearly doubled in two years while employer NIC adds hundreds of millions of pounds. Enterprise Nation, whose survey of 526 small firms was reported on 11 and 12 September, found that three in ten high-street small businesses considered closing in the past year and that VAT, not wages or rates, was the most-cited pressure. Its own Budget submission leads with a hospitality VAT decision and higher Small Business Rate Relief thresholds rather than the 75% discount.
The British Retail Consortium, which speaks for the large chains, has historically pushed for a lower headline multiplier for all retail property rather than targeted relief for small units, and has been sharply critical of the £500,000 higher-rate threshold, which catches large supermarkets and department stores. That creates a tension with Bira’s approach: a general multiplier cut benefits Tesco and John Lewis as much as a village greengrocer, while a capped 75% discount is worth proportionately far more to the greengrocer.
Where the bodies agree.
All three agree on the employment cost problem. The combined effect of the April 2025 NIC changes and two years of above-inflation National Living Wage rises has been documented in job losses across the sector, which we covered when UK retailers cut 18,000 jobs earlier this year. They also broadly agree that overseas marketplaces enjoy a structural tax advantage on low-value parcels, and that the October 2028 date for customs reform is too slow.
Where they differ is on sequencing and on who should pay. Bira’s position is unambiguous that the smallest operators should be first in the queue, and that a cash-capped discount is the fairest way to ensure that. The BRC’s is that the sector as a whole is over-taxed relative to its share of the economy. The Chancellor may find it easier to do something modest for both than something significant for either.
What does the timetable look like between now and the Budget?
The Budget itself is confirmed for Wednesday 28 October 2026, with the statement expected at around 12:30 after Prime Minister’s Questions. Several data points and deadlines fall before then that will shape the mood in which it is delivered.
- 16 September: ONS consumer price inflation for August. A hot print would confirm Healey’s warning about the Middle East and narrow his room for manoeuvre.
- 17 September: Bank of England interest rate decision and Next’s half-year results, a bellwether for high-street demand.
- 18 September: ONS retail sales for Great Britain, August. The BRC-KPMG monitor for the same month showed growth of 0.7%, with non-food sales falling.
- 1 October: The first tranche of Employment Rights Act changes takes effect, extending the tribunal claim window from three to six months.
- 28 October: Budget day, followed by the Office for Budget Responsibility’s forecast and, typically, the publication of the provisional multipliers for 2027/28.
For shop owners the most important practical point is the last one. Business rates bills for 2027/28 are set by the multipliers announced at or shortly after the Budget and confirmed in the Local Government Finance Settlement in December. Any change Bira wins on 28 October would show up in the bills that land in February and March 2027. Employer NIC and Employment Allowance changes, if any, would normally take effect from 6 April 2027.
The Employment Rights Act as a second cost line.
Bira’s “cost of employment” phrase covers more than wages and NIC. The Employment Rights Act changes landing on 1 October introduce a new duty on employers to take all reasonable steps to prevent harassment of staff by customers, alongside the longer tribunal window, with the qualifying period for unfair dismissal falling to six months from January 2027. For a small shop without an HR function these are compliance costs in time as much as money, and they fall in the same quarter as the Budget.
What could the Chancellor realistically offer?
Given the fiscal position, most observers expect any rates measure on 28 October to be narrower than the 75% restoration. Several options are on the table, each with different winners.
The cheapest would be a freeze of the RHL multipliers for 2027/28 rather than the default uprating in line with September CPI. That would meet Bira’s “no higher bill” test for any shop whose rateable value is unchanged, at a cost that scales with inflation rather than with the size of the sector. A second option would be to raise the Small Business Rate Relief thresholds, which currently cut off at £12,000 and £15,000, so that more high-street units fall out of rates altogether. Enterprise Nation has asked for this explicitly and it targets money at the smallest operators without reopening the multiplier structure.
A third, more expensive option would be a time-limited percentage discount for qualifying properties below a lower cap, perhaps £51,000, restoring something like the old relief for the smallest shops while excluding chains. This is closest to Bira’s ask in effect, if not in form. The most expensive option, a full 75% restoration, is the one Bira has asked for and the one the fiscal backdrop makes least likely.
The Employment Allowance is the easier lever.
On employment costs, an increase in the Employment Allowance is administratively simple and well targeted, because it is worth proportionately most to employers with a handful of staff. Doubling it to £20,000 would cost the Exchequer significantly less than a NIC rate cut and would be visible to every small employer from April 2027. It is also the ask on which Bira, the ACS and the FSB are most closely aligned, which makes it the most plausible candidate for a Budget-day announcement aimed at the high street.
Why does this matter for shoppers, not just shop owners?
Business rates rarely feature in consumer conversations, but their effects are visible on every high street. Rates are a fixed cost that does not fall when sales do, so they bite hardest in downturns and on marginal units. Trade-body surveys consistently rank them with rent and wages as a top-three reason for closures, and the closures of recent weeks, from bakery chains to discount stores, have typically cited cost pressure rather than a lack of customers.
The counter-argument, made by successive Treasuries, is that rates are a stable, hard-to-avoid tax on property that ultimately falls on landlords through lower rents. That may be true over a long enough horizon, but leases in many town centres run for five or ten years, and the shop bears the cost until the next rent review. For a shopper the practical outcome of a Budget that helps or hurts small shops will be measured in whether the units on their local high street are open next spring.
Bira’s own Heartbeat survey, published in November 2025, found 46.2% of independent retailers pessimistic about 2026, with 51.9% reporting year-on-year sales declines and only a quarter confident about the Christmas period. Those figures predate the April 2026 rates changes and the summer’s inflation shock. The association has not yet published a more recent reading, but its language this week suggests the mood has not improved.
Frequently asked questions
When is the Autumn Budget 2026?
The Budget is confirmed for Wednesday 28 October 2026, with Chancellor John Healey expected to speak at around 12:30 after Prime Minister’s Questions. It is his first Budget since his appointment under Prime Minister Andy Burnham.
What is Bira asking for on business rates?
Bira wants the government to restore the 75% retail, hospitality and leisure discount, subject to a £110,000 cash cap per business, and to guarantee that no independent retailer faces a higher business rates bill in 2027/28. It also wants longer-term reform of the system.
What business rates multiplier do shops pay in 2026/27?
Qualifying retail, hospitality and leisure properties in England pay 38.2p in the pound if their rateable value is below £51,000 and 43p if it is between £51,000 and £499,999. Properties with a rateable value of £500,000 or more pay a higher multiplier of 50.8p. Small Business Rate Relief still applies below £15,000.
Did the 40% retail discount end in April 2026?
Yes. The temporary percentage discount for retail, hospitality and leisure properties, which was 75% in 2024/25 and 40% in 2025/26, was replaced from 1 April 2026 by permanently lower multipliers. The new multipliers have no cash cap but are worth less than the old discount for most shops.
What is the Employment Allowance and why does Bira want it doubled?
The Employment Allowance reduces an eligible employer’s annual employer National Insurance bill by up to £10,500. Bira wants it raised to £20,000 so that a shop with five to seven staff on the National Living Wage would pay no employer NIC at all.
What did Chancellor Healey promise in his growth speech?
On 7 September Healey committed to reducing the burden of business regulation by 25% by the end of the Parliament and said the Budget would set out a roadmap for greater business rates retention by local councils and strategic authorities from 2028. He did not announce any change to the level of business rates.
Will the Budget cut business rates for small shops?
Nothing has been announced. Healey has warned the Budget “could be tough” because of the Middle East conflict’s effect on inflation and borrowing costs, and has not ruled out tax rises. A multiplier freeze or higher Small Business Rate Relief thresholds are seen as more likely than a full restoration of the 75% discount.
What is the National Living Wage in 2026?
From 1 April 2026 the National Living Wage for workers aged 21 and over is £12.71 an hour. The rate for 18 to 20-year-olds is £10.85 and the rate for under-18s and apprentices is £8.00, according to HMRC guidance.
How many shoplifting offences were recorded last year?
Police in England and Wales recorded 507,086 shoplifting offences in the year to March 2026, down 4% from 530,324 the previous year, according to figures cited in Bira’s Budget submission. Bira wants continued investment in neighbourhood policing.