The Government is being urged to give a six-month business rates amnesty for firms occupying empty properties as part of “fundamental reforms” to the system.
The Business Committee called for a “wholesale review” of business rates in a bid to help retailers and boost local economies.
The MPs said there should be an examination of whether retail taxes should be based on sales rather than a property’s rateable value.
They also suggested that retail needed its own system of business taxation, adding that a six-month amnesty would encourage new businesses to the high street.
Concerns were raised that money allocated to a number of towns following a review headed by retail expert Mary Portas was not being spent.
Around £2.3m was earmarked for so-called Portas Pilots, but committee chairman Adrian Bailey (Labour) said the Government could not provide evidence of how, or even whether, the money has been spent. The Portas report, completed over two years ago, had stressed the need for a review of business rates, the MPs noted.
Mr Bailey said: “British retail is a global success story. Employing around three million people, it is the largest private sector employer in the UK. But its traditional home – the high street – is struggling under a system of business rates that comprises one of the highest forms of local property tax in the EU.
“This is a time for wholesale review and fundamental reform, not for tinkering around the edges. Business rates are not fit for purpose and minor administrative changes will not alter that.”