The Federation of Small Businesses (FSB) has stated that the current business rates system in England serves to 'disincentivise businesses to invest in net zero and employee wellbeing measures'.
In a letter to the government, the business group said that small firms should not be penalised with higher business rates bills for greening their premises or improving staff wellbeing. It also stated that childcare providers should be granted business rates relief.
Ahead of a government business rates review this autumn, the FSB described the business rates system as 'regressive and outdated', and suggested that some small firms should be removed from the system altogether.
Mike Cherry, National Chairman of the FSB, said: 'This is a levy that hurts small firms trying to do the right thing: if you put solar panels on the roof to aid your transition to net zero, or install ventilation to support the wellbeing of your staff, the Valuation Office Agency will advise your local authority that you should be paying more in business rates.
'As we look to aid the small business community's transition to net zero and employee safety and wellbeing as we come out from the pandemic, this simply cannot be the right approach to taxation.'