Asda to continue paying business rates despite offer of relief in Spring budget

Big four supermarket Asda has confirmed it will continue to pay business rates in full during 2021-22 and will not accept the offer of rates relief announced today by the Chancellor in his Spring budget.

Roger Burnley, CEO and president of Asda, says "we hope that by continuing to pay business rates in full this year this we can continue to support the nation’s economic recovery from the pandemic".

The Leeds-based grocer announced back in December that it would hand back £333m in business rates relief following in the footsteps of Tesco, Sainsbury’s, Morrisons and Aldi.

The move last year came after growing pressure on the supermarket sector to return the relief, which was aimed at retailers that were unable to open and were struggling to make ends meet due to the coronavirus pandemic.

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Roger Burnley, CEO and president of Asda, said: “We have always sought to support colleagues, customers and communities during the pandemic and will continue to do so as long as Covid remains a threat.

“There are clearly many industries and businesses that have been hard hit by the pandemic and we hope that by continuing to pay business rates in full this year this we can continue to support the nation’s economic recovery from the pandemic.”

Asda says it recruited more than 22,000 temporary staff to cover absences and increased demands in stores at the height of the pandemic, without using the Government’s furlough scheme.

The Chancellor has said that the business rates holiday will be extended until the end of June for hard-hit retail, hospitality and leisure firms before shifting to a two-thirds discount for the rest of the year.

Rishi Sunak also told MPs that current VAT cuts for hospitality firms will also be extended for another six months, before tapering back to the previous tax rate.

Non-essential shops and hospitality venues have been particularly heavily hit by the impact of the pandemic and remain shut in the face of the nationwide lockdown.

Retail, hospitality and leisure firms will now see the current business rates holiday - which was due to expire at the end of this month - extended until the end of June, when restrictions are intended to be fully wound down.

"For the remaining nine months of the year, business rates will still be discounted by two thirds, up to a value of £2m for closed businesses, with a lower cap for those who have been able to stay open," Mr Sunak said.

He also told MPs that the current temporary 5 per cent rate of VAT on food and soft drinks, hotel accommodation and leisure attractions will be extended until September 30.

The Chancellor added: "We'll have an interim rate of 12.5 per cent for another six months; not returning to the standard rate until April next year.

"In total, we're cutting VAT next year by almost £5bn."

High street and hospitality firms are also set to benefit from a £5bn grant scheme designed to aid the recovery of these sectors following the heavy impact of the pandemic.

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