New research from the Co-op has warned that some 60,000 small shops and 150,000 jobs could disappear unless business rates are reformed in next month's Autumn Budget.
The Manchester group has declared that Britain's high streets "face a critical moment" and that Chancellor Rachel Reeves must announce "maximum" business rates relief on 26 November.
It that Rachel Reeves was examining "fixing" cliff-edge business rates, which force small businesses to pay higher taxes when opening a second property. The Chancellor is now reviewing amendments to the small business rates relief, with a decision anticipated to be revealed at the Budget.
Previously, Treasury officials highlighted concerns that small street shops encountered "sudden jumps" in taxes when launching a new property, as reported by .
The government is poised to consider shifting from "slab" business rates, where a single multiplier is applied to the full rateable value of properties, to a "slice-based" marginal tax rate system, where bands are taxed at escalating rates.
Companies face lower tax rates for retail, hospitality and leisure properties with a rateable value below £500,000 whilst those exceeding the threshold pay at a rate determined by a higher multiplier.
The new rates for businesses will be established at this year's Autumn Budget but Reeves has suggested that reliefs for businesses with properties at a rateable value under £15,000 could be altered. Last month, the British Retail Consortium cautioned that the government is at risk of 'losing the battle' against inflation if business rates on large shops increase.
The new research from YouGov reveals that seven out of ten º£½ÇÊÓƵ adults are sceptical about the government's ability to deliver on its promise of relief for small businesses.
The data also indicates that if business rates reform is not implemented, 10 per cent of small high street business owners would have to make staff redundant, and one in eight would face the threat of closure.
Furthermore, the study shows that 77 per cent of small high street shop owners believe business rates reform is crucial for survival, while 44 per cent would find it difficult to expand without protections.
A total of 36 per cent of those surveyed said they would freeze pay increases, and 26 per cent would stop hiring altogether.
The research also found that 77 per cent would support an online retail tax to 'level the playing field' with e-commerce giants.
Shirine Khoury-Haq, CEO of the Co-op Group, said: "As we approach a critical Autumn Budget, there's a real danger that the voices of small shops – and the communities they serve – are not being heard.
"Local shops aren't just businesses; they're part of the social fabric of Britain. For some, a visit to a local store is one of the few chances they have to chat to someone and feel connected.
"This research shows a clear public mandate for action. Regardless of how they vote, the majority of people want the government to do more to protect their high streets.
"This is an opportunity for the government to really prove to people that they will do what it takes to make a difference to people's communities and to their wellbeing.
"The proposed system would improve the financial situation of 99 per cent of retailers. How much they are protected from tax rises depends on decisions made in this Budget.
"To boost local economies, create jobs and provide community cohesion, we need inclusive growth.
"That means supporting the businesses on the corners, in the precincts, on the parades and the high streets of every community. In order for them to not only survive, but to thrive, the government has to commit to the maximum levels of relief."
The Co-op's headline assertion that 60,000 enterprises could shut down and 150,000 positions lost if business rates are not reformed in the Autumn Budget is founded on survey data from Opinion Matters.
The findings reveal that 12.82 per cent of small high street business proprietors in England indicate they would face closure risk without business rates reform.
The study also discovered that 18.92 per cent of small retail enterprises stated they would either need to reduce workforce or face closure without business rates reform. Data from the º£½ÇÊÓƵ Statistics Authority reveals that there are roughly 482,810 small retail businesses in England.
Applying a rate of 12.82 per cent to this figure indicates that 61,896 businesses could face closure without reform to rates.
With the statistic of 18.92 per cent, it suggests that 91,348 businesses may have to reduce staff or risk shutting down.
Regarding job losses, The Co-op has estimated the potential impact if small businesses were forced to cut between five per cent and 30 per cent of their workforce. This could put between 100,000 and 200,000 jobs at risk, with 150,000 being used as a midpoint.
