Rate relief: Cuts delay brings charities mixed reaction

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Hangers Charities argue the business rate relief cuts could drive them off the high streets

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Charities across Wales have welcomed a delay in proposals to cut their business rate relief but say are they concerned it may still happen.

The plans include cutting the relief on rates from 80% to 50% for most charity shops and limiting numbers in an area.

Economy Minister Edwina Hart said she would consult UK and other government ministers on any law changes needed.

There have been concerns that charity shops have increased on the high street driving away commercial retailers.

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There is a lack of security for our charity shops, making it difficult for us to plan for our future”

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But the plans being considered by the Welsh government faced a determined campaign by the charity sector who said shops would close, jobs would be lost and wider services damaged.

The British Heart Foundation Cymru warned that around a third of its shops - 10 in total - would face closure.

Some of those are larger furniture stores which would have lost their rate relief completely.

These shops sell new products as well as those donated to them and it is that which has particularly annoyed some other small businesses who say they cannot compete on the same terms.

Charities argue that the sale of new goods is a small percentage of their overall takings but Edwina Hart told assembly members that she would be monitoring this issue.

Umbrella body the Wales Council for Voluntary Action (WCVA) welcomed this but said it was disappointed the minister had not thrown out the idea of cutting charity rate relief.

Tenovus shop Tenovus has abandoned plans to expand into another 14 outlets

Prof Brian Morgan, who chaired the independent group that recommended the changes to charity relief, said he was pleased ministers were taking the proposals forward, adding that other parts of the UK were also considering their recommendations.

The largest charity retailer in Wales, Tenovus, said that the plans had already had an impact and it had abandoned plans to expand into another 14 outlets.

A Tenovus spokesman said: "This announcement still means there is a lack of security for our charity shops, making it difficult for us to plan for our future and continue to raise the vital funds we need.

"The money raised through our network of shops currently brings in over 60% of our charitable income.

'Nailed coffin lid'

"Our charity shops exist to raise money so we can support cancer patients and their families, wherever and whenever they need it most."

Charity Retail Association chief executive Warren Alexander said: "We are pleased that vital charity rate relief is not being cut for now and hope that common sense prevails and these proposals are not pursued any further.

"Any change to rate relief would have an impact on the amazing charitable work that is done, create more empty shops and damage our high street.

Welsh Liberal Democrat business spokesperson Eluned Parrott said Ms Hart had "fudged" the decision and said the announcement "should have nailed the coffin lid on proposals to hike taxes on charities".

The party did welcome the other two schemes unveiled by the economy minister that aim to help the high streets.

'Sticking plaster'

More than £5m will be made available for the "Open for Business" and the "New Developments" schemes.

These will see financial relief for businesses that move into property that has been vacant for a long time and exempt newly-built properties from business rates.

The Federation of Small Businesses called the Welsh government's announcement "a sticking plaster on a gaping wound".

"The business rates system in Wales is outdated, iniquitous and broken, and while the measures announced by Mrs Hart will provide some welcome aid to those starting a new business or engaged in speculative development, they will do nothing to ease the pressure on the majority of hard-pressed businesses on high streets across Wales," a spokesman said.

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