Businesses are struggling after a 35% cut in rates cuts in Wales

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New recycling laws in Wales and a reduction in business rates relief are creating a “perfect storm” for the high street, a councilor has warned.

This month, businesses in the retail, hospitality and leisure sectors have seen the amount of tax they pay to the Welsh Government rise after temporary relief was cut.

Instead of getting a 75% discount on their bills, they now only get a 40% discount. In England this figure remains 75%.

Mojo King is a branded men’s clothing store in Caerphilly, and owner James Parker believes it could spell the end of his business.

Mr. Parker told it Caerphilly Observer how the store on Pentrebane Street in the city of Caerphilly has struggled since moving from Clive Street in 2023.

He said: “We have been established since 2016 – and the old store was doing well.

“We had to move due to the market closure/construction work and since the move we have struggled to get our name out there.

“To be honest, I’m in a pretty tough situation right now. I am fighting with the municipality for some form of support, but this interest rate cut could be the final nail in the coffin for me.”

Independent group leader and Blackwood councilor Nigel Dix has been against the Welsh Government’s decision to cut aid since it was first proposed last year.

He said: “I have spoken to many businesses in Blackwood alone who are seriously concerned about the current situation.

“Blackwood currently has a record 29 vacant units. We have recently lost two banks and a major retailer and I fear this, combined with the cuts and the new recycling programme, will create the perfect storm.”

New recycling laws in Wales mean businesses now have to further separate their recycling.

One business feeling the impact of both is Maxime Cinema on Blackwood High Street.

Steve Reynolds, told from the cinema Caerphilly Observer it costs Maxime £2,000 a month to clear his rubbish.

Mr Reynolds said: “We haven’t had the help here in the film industry that we probably need. Ticket sales are still down about 25% from pre-pandemic levels, and it’s tough.

“That tariff subsidy would have been very useful at 75%, especially as recycling costs have increased, as have wages – which is well deserved though.

“Our full rates are now around £50,000 per year – that’s £900 per week.”

Despite rising costs, Reynolds said the cinema is reluctant to pass them on to customers and has not implemented a ‘significant’ price increase since 2017.

“We have increased the booking fees slightly, but this is not the right time to increase prices. We fully appreciate the pressure on audiences and know that without families coming to see films we wouldn’t have a business.”

Mr Reynolds added that he remains optimistic about the future of the film industry’s impact on the high street.

He said: “We make an important contribution to the economy here in Britain and we need support.

“Cinema should be a habit and not a treat. Although the industry has been through difficult times recently, we are confident that we can move forward.”

Mojo King’s Mr. Parker, however, is less optimistic.

He said: “The costs are only increasing. I recently made a post on social media explaining that I had only had a few sales in three weeks.

“I just don’t see us staying honest, but we will until the bailiffs come.”

Cllr Dix concluded: “I have raised my concerns with the council and asked them to deal with it and provide the support they need to remain open.

“Many companies are small and operate within very tight margins. Now is not the time to cut support and introduce a costly recycling program.

“We all want to do what we can to ensure we recycle, but we need to make sure we don’t destroy the high street in the process.”

Deputy chairman of the board Jamie Pritchard said: “I fully understand that businesses are really feeling the pressure, with factors such as energy costs and online retail changing the way we shop.

“Here in Caerphilly we have put the center policy first, but I agree that the Welsh Government needs to consider the concerns of the business community.

“I would also add that more radical changes to business rates require urgent attention. However, this is ultimately a decision for the Welsh Government.”

Caerphilly Media

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