A business leader has criticised the government after a popular London bakery chain was forced to closed its doors over high business rates.
Coughlans Bakery, which first opened in 1937 and has 31 stores across the southeast, has ceased trading after going into voluntary liquidation.
The bakery chain, part-owned by comedian Romesh Ranganathan, made the decision to close to ensure that they can pay their suppliers and staff.
Co-owner Sean Coughlan said that he was “devastated” by the closures, which he partly blamed on extra National Insurance payments which came into effect from April 1.
In a statement released on Instagram, he said: “Rates have absolutely smashed local businesses, local retail.”
Business rates for UK hospitality businesses increased significantly in April following the end of government pandemic relief support, which reduced some rate payments by as much as 75 per cent.
Pubs and live music venues received a new 15 per cent discount from April 1 - but cafes were excluded from the additional support.
UK trade body UKHospitality has forecast that higher business rates would force two-thirds of hospitality operators to cut jobs and 15 per cent left with no option but to close.
Ros Morgan, chief executive of Heart of London Business Alliance (HOLBA), said that the UK’s current system puts an “unfair burden” on small businesses, and is “no longer fit for purpose”.
HOLBA represents more than 500 businesses and is a member of the Real Rates Reform Alliance.
Ms Morgan said: "The closure of Coughlans Bakery after almost 90 years on the high street is another stark reminder that Britain's business rates system is no longer fit for purpose.
"The news shows how an outdated property tax continues to place an unfair burden on firms that invest in bricks-and-mortar locations, create jobs and keep our town and city centres vibrant.
"The Government has a real opportunity to deliver the meaningful business rates reform it promised. The Real Rates Reform Alliance's hybrid business rates model would broaden the tax base through a modest levy on online sales, enabling a permanent reduction in business rates for businesses investing in physical premises.
"It is a practical, long-term solution that reflects the way the modern economy works, supports investment on the high street and helps prevent more viable businesses from being pushed to the brink.”
Mr Coughlan also cited the spike in fuel prices in the wake of the conflict in the Middle East - with the company’s fuel bill doubling from £3,000 to £6,000 - and the recent heatwaves for putting the “nail in the coffin” for the business.
It appears that all 31 Coughlans stores will close with immediate effect - including a number of branches across Croydon and Coulsdon in south London.
Ms Morgan added: "The closure of a long-established family business should be a wake-up call. Ministers must now deliver the real rates reform needed to give high street businesses the confidence to invest, grow and create jobs."
