Over 80,000 shops across the UK face threat of closure if an overhaul of business is not conducted, according to the British Retail Consortium.
Ministers have been warned by the group that changing shopping habits and growing tax burdens could cause almost two out of three town centre shops to close by 2017.
The British Retail Consortium has based its figures on what would happen if six out of every ten high street retailers who have leases expiring in the next two years, opted not to renew them.
Retail Week reports that business rates are predicted to bring in about £28 billion for the Treasury this year.
The BRC has now called on George Osbourne to prevent ‘a town centre exodus by reforming the business rates system to improve the climate for retailers.’
Pressure has been ramped up by the group, who has highlighted research conducted by Verdict that revealed the number of town centre shops has declined from 148,990 in 2004 to 129,121 today.
The group wants Osbourne to provide a tax relief for small businesses, scrap the inflation-linked increase in business rates and conduct property valuations every three years instead of five to make the system fairer for retailers.
“For a government which has advocated pro-growth policies to support business and embed the recovery, business rates are an anomaly and stand out in an otherwise moderate tax regime,” said the BRC in its report.
“Business rates are a tax on jobs and growth and when combined with structural changes to the retail industry risk leading to far more store closures, job losses and high street vacancies.
“It is essential that we work together to design a tax that reflects the economic reality facing business.”