Cold Chain Warns: Warehouse Tax Could Push Food Costs Higher
- 13 hours ago
- 3 min read
A fresh warning has been sounded over proposals to place higher business rates on warehouses, amid fears that well-intentioned plans to support Britain’s high streets could end up piling further pressure onto the food supply chain.
Phil Pluck, Chief Executive of the Cold Chain Federation, used a strongly worded LinkedIn post this week to challenge the idea that warehouses could “shoulder more tax burdens” in order to fund support for pubs, restaurants and high street businesses. His central argument was clear: not all warehouses are the same, and the temperature-controlled food and pharmaceutical supply chain should not be treated as an easy revenue source.
The comments follow reports that Andy Burnham has suggested there is a case for higher business rates on warehouses and major out-of-town developments, with the proceeds used to reduce rates for pubs and high street businesses. The proposal has been framed as a way of rebalancing the tax system away from traditional high streets and towards large-scale warehouse operations, particularly those associated with online retail.
But the cold chain is warning that such an approach risks serious unintended consequences.
In his post, Pluck pointed out that the UK cold chain operates around 460 temperature-controlled warehouses and underpins around half of the nation’s food supply, as well as essential temperature-controlled medical products, including cancer treatments, vaccines, insulin and blood.
That makes the sector very different from the popular image of vast fulfilment sheds moving consumer goods from online baskets to front doors. Cold stores and refrigerated distribution networks sit behind supermarkets, schools, care homes, hospitals, restaurants, foodbanks and the wider fresh food economy. They are not a luxury add-on to the economy. They are part of the machinery that keeps people fed and medicines safe.
The Cold Chain Federation has already argued through its recent white paper, The Critical Link, that the UK’s temperature-controlled logistics network should be recognised more clearly within national resilience planning. The Federation says safe, reliable food and essential pharmaceuticals are often taken for granted, despite depending on a complex cold chain that keeps perishable products moving every day.
That point matters because the sector is already absorbing a long list of rising costs. Pluck cited recent increases in national insurance, fuel, energy, the National Living Wage and business rates, warning that cold chain businesses are now operating on thin margins with little room left to invest, create jobs or absorb new costs.
For fresh produce, flowers and plants, this is not an abstract debate about tax policy. It goes straight to the heart of supply chain resilience.
Fresh produce depends on speed, temperature control, precision handling and reliable logistics. Adding cost into that system rarely stays neatly contained at one point in the chain. It can affect haulage, storage, distribution, retail prices, food waste, supplier margins and ultimately consumer affordability.
Pluck’s warning is that any additional costs will “only go one way”. In plain terms, that means through the supply chain and towards the customer.
The timing is particularly sensitive. Food inflation has already placed households under strain, while industry bodies continue to warn that climate pressure, fuel volatility, labour costs, border disruption and energy demand are all testing the UK’s food system. The Cold Chain Federation has also warned that extreme heat is placing increasing pressure on refrigerated storage and transport infrastructure that supports around half of the UK’s food supply and a significant proportion of pharmaceuticals.
None of this means high streets, pubs, restaurants and independent retailers do not need help. They plainly do. Many are struggling with business rates, labour costs, energy bills and weak consumer spending. A healthier high street matters to communities and to local economies.
But taxing one fragile part of the food system to relieve another is a risky game of pass-the-parcel — and this parcel is refrigerated, perishable and already expensive to move.
The more constructive question is not whether warehouses can pay more, but which warehouses, serving what purpose, with what impact on national resilience.
A policy designed to target online retail giants must not accidentally catch the infrastructure that keeps fresh food, frozen food, flowers, medicines, vaccines and blood moving safely across the UK.
For the fresh produce industry, the message is simple: reform business rates by all means, but do it with surgical precision, not a shovel.
The cold chain is not just another property class. It is the quiet, energy-intensive, highly skilled backbone of modern food supply. If policymakers load more cost onto it without understanding its role, the result will not be a fairer high street. It will be a more expensive food system.
And for consumers already watching every penny, that would be the very opposite of relief.
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