Colchester MP Sir Bob Russell has called on the Chancellor to scrap business rates on small shops and introduce a levy on out-of-town retail car parks instead.

The Liberal Democrat, who made the call during Treasury Questions in the House of Commons last week, said the move would help specialist shops in Colchester town centre and other areas struggling to survive difficult trading conditions.

Afterwards, he added: “A levy on car parks at these mega retail locations would be negligible for the overall turnover they enjoy, but the sum collected would offset the cost of removing business rates from small shops.”

The idea has been supported by Michelle Reynolds, chairman of the Colchester Retail and Business Association (CORBA), who said it would help put smaller shops on a more “equal footing” with larger stores.

She said: “People who come into the centre of town have to pay to park but they don’t out of town. Anything more that can be done to help with business rates would be welcomed.”

However, a spokesman for the British Retail Consortiums said that all retailers – whatever their size – are struggling at the moment.

He added: “Retailers both large and small are at the heart of local communities and their contribution includes offering good employment to local people, so the focus should be on affordability for all.”