PARLIAMENTARY DEBATE
Small Businesses: Fiscal Support - 7 May 2024 (Commons/Commons Chamber)

Small businesses drive our economy, and we support them to thrive using levers across Government, whether through our small business rates relief, by increasing the VAT registration threshold, or providing reliefs such as the annual investment allowance.

In England, many small businesses receive a 75% reduction in business rates thanks to action by this Conservative Government. In Wales, the Labour Administration have cut that level of support to 40%, meaning that excellent hospitality businesses such as Martha’s Vineyard in my constituency must find thousands of pounds more in tax. Does the Minister agree that that is not the way to support the tourism and hospitality sector at a challenging time, and that it is an example of the Labour party saying one thing here at Westminster and doing another where they are in government?

My right hon. Friend is right that in the autumn statement the Government extended retail, hospitality and leisure relief in England, essentially to cut tax for 230,000 businesses—a tax cut worth £2.5 billion. The Barnett formula allows the Welsh Labour Government to offer similar relief to Welsh businesses, and it is disappointing, if not surprising, that they have chosen not to.

As I was saying, we have a 75% relief for most high street businesses. I encourage the hon. Lady to look at the package as a whole. We have increased the VAT threshold, bringing 28,000 businesses like the one she describes out of paying any VAT at all, on top of a range of other measures.

The cherished independent shops and restaurants that line the streets of Morley serve the lifeblood of our community. In order to safeguard the very heart of our local economy, what bold measures is the Department taking to counter the oppressive weight of skyrocketing business rates imposed by the financially reckless Labour-led Leeds City Council?

I know that my hon. Friend is a great champion of all businesses in Morley and across Leeds because I have seen it at first hand. I point out to her as well that the Government have reduced taxation on small businesses, we have increased the VAT threshold, and we have a 75% rate relief for retail, hospitality and leisure businesses, which she alluded to. It is this Conservative Government who are on the side of hard-working people and businesses across Morley and around the country.

In the last decade, more than one music venue closed every week, including Moles in Bath. That has resulted in the loss of 4,000 jobs, 14,250 events, over 190,000 performance opportunities, £9 million of income for musicians and £59 million in lost direct economic activity. What are the Government doing to support small music venues?

We are doing a lot. We are increasing the VAT threshold, and we have a rates relief package. The recent spring Budget was one of the biggest packages supporting our cultural industries that this country has ever seen, and I encourage the hon. Lady to look at it.

I call the shadow Minister.

Since 2022, almost 400 communities have lost their local bank branch, which has had a devastating impact on local and small businesses. Despite witnessing the decline of the British high street, the Government have been dragging their feet on rolling out banking hubs, which would help local and small businesses. Will the Minister finally back the Labour party’s plans to provide a banking hub in every community that needs one?

Banking hubs are driven by commercial organisations. Any area that loses bank branches is entitled to get a banking hub. Of course, we want to see more across the country, but we also have to recognise that banking has changed and the ways in which people bank have moved more towards digital, so it is right that commercial organisations take commercial decisions.