Three quarters of international retailers said that they would expand elsewhere in preference to the UK due to a number of perceived barriers, the most significant being business rates.
That’s according to new findings from shopping centre owner Intu and retail property organisation Revo, who are calling on the Government to do more to support and promote UK retail.
David Fischel, intu chief executive, said: “The good news is that overseas retailers are interested in the UK because it is a large market, has sensible employment regulations, low corporation tax and a sound digital infrastructure.
“However, almost three quarters of the retailers surveyed said they would consider other countries in preference to the UK for expanding their business; with the stand- out issue being the high level of UK property taxes, especially business rates.”
The research found the UK is seen as attractive across 36 key factors including solid economic growth rate, a sensible approach to labour relations, low corporate tax rate and sound digital infrastructure.
However, the business rates system was rated the most unattractive factor to investing in the UK with respondents saying that the fixed property tax prevented them from entering the country.
New business rate levels – the first in seven years – will be introduced in April and will see businesses paying up to 42% more than previously.
Recommendations within the report include promoting the UK to international retailers, addressing issues relating to planning and providing more help to navigate the complex legislative and wider regulatory landscape.
The UK retail sector generates £326 billion in sales each year and directly employs around 3 million people.