According to the CBI, the government intends to increase business rates by 5% in April 2009, in line with last September's unusually high RPI rate of inflation. It has revealed its intentions in a letter to local government.
They say this will act as a 'freeze' on the economy at a time when the economy needs a boost.
CBI’s Director of Business Environment policy, Dr Neil Bentley said: "This unnecessary jump in business rates will affect nearly every firm, and struggling retailers will be particularly hard hit, at a time when they need all the help we can give them.
"Pegging the increase to September's record RPI rate - an 18-year high - enables government to raise £400M in extra tax revenues from firms when they can least afford it.
"The CBI had called for a freeze in business rates, to give the economy a much-needed boost during these exceptionally difficult times. But councils will now have carte blanche to raise £1.15bn extra in business tax next year.
"This threat to jobs, investment and the survival of viable businesses can still be avoided if the government lives up to its promise of 'doing everything it can' by freezing next year’s rates," he said.