Sadiq Khan is calling for the government to extend the business rates holiday for another year as companies say reintroducing the rates would be the “final blow” for those already struggling during the pandemic.
Business rates for the retail, hospitality and leisure sectors have been halted in England until the new financial year starts next April.
The mayor of London, along with councils in the capital, have urged the rate holiday to be extended to 2021/22 over fears tens of thousands of jobs could be lost in the city.
“Businesses across London continue to struggle from the impact of COVID-19,” Mr Khan said.
“If the business rates holiday comes to an end, I worry any employers will have no choice but to make more people unemployed.
“Many large retail, leisure and hospitality businesses – accounting for thousands of Londoners’ jobs – are taking important decisions for the next financial year right now, so certainty over the business rates holiday is needed urgently.”
The London mayor also called for an extension to the business rates holiday for childcare providers, which he said were “crucial” in allowing Londoners to return to work.
The New West End Company, representing 600 businesses in the capital’s shopping district, said reintroducing business rates next April would be the “final blow”.
“The result will be more business closures and potentially 50,000 job losses, severely diminishing London’s appeal to visitors, investors and global talent,” said chief executive Jace Tyrrell.
“We appreciate the support that the government has given to businesses so far but it is clear that the impact of COVID-19 is going to last much longer than originally anticipated.”
Mr Khan and London Councils, which represents the capital’s 32 borough councils and the City of London, also want to see reforms to the system as a whole – including devolving the power to set business rates and making the system easier to understand.
Councillor Clare Coghill, London Councils’ executive member for Business, Europe and Good Growth, said many businesses are “still reeling from the long-term impacts of COVID-19”.
“Ending the business rates holiday too soon will destabilise too many companies, leading to closures, job losses and a shrinking economy both in London and across the rest of the country,” she said.