The role of larger companies in Business Improvement Districts (BIDs) could be marginalised if the Government introduces supplementary business rates (SBRs).

Chancellor Alistair Darling wants to allow councils to levy a tax on companies that occupy a property with a rateable value of more than £50,000.

It is widely expected that cash-starved local authorities will seize on the SBR as an opportunity to raise money without having to put up council taxes.

A company hit by the SBR is unlikely to voluntarily pay an extra charge through the creation of a BID, despite having a say over how it is spent.

Business leaders in Brighton had been looking to create a BID along the seafront and in Western Road but those hopes may now have been dashed.

Town centre manager Soozie Campbell said: "If SBRs are imposed it is going to be extremely difficult to go to large establishments and ask for more money.

"The idea of suddenly having to pay twice will not appeal. This would be a great shame. In many ways SBRs demonstrate just how attractive BIDs are."

Brighton already has a BID covering most of North Laine, North Street, and The Lanes. Any future BIDs are now likely to be an extension of that area.

Business groups have called on Mr Darling to scrap or rethink his White Paper on supplementary business rates.

The Federation of Small Businesses, (FSB) the CBI and Institute of Directors (IoD) are all firmly opposed to the introduction of SBRs. However, should the scheme proceed, business groups would like to see them decided on a vote, in much the same way as BIDs.

The White Paper currently stipulates that only if the SBR contribution comes to more than a third of the cost of the capital project will businesses get a vote.

David Frost, director general of the British Chambers of Commerce, said: "Business is opposed to the introduction of a supplementary business rate. Companies are facing enormous global competitive pressures and any additional tax will further harm their ability to compete.

"If, however, councils are given the flexibility to introduce a supplementary business rate it is essential that businesses are given a vote.

"If a supplementary business rate is to provide funds for an infrastructure project that business believes is necessary and if there is a clear project plan with ring-fenced funds tied to the scheme with the money raised being wholly additional, then the business community may well vote yes in a ballot."

Roger Culcheth, FSB local government chairman, said: "The FSB is firmly opposed to supplementary business rates. However, if the Government is determined to go ahead then it needs to listen to businesses in order to choose the least damaging option. Otherwise councils will use it to raise revenue more easily than if they put up council tax, hitting local economies and employers.

Without a vote for small businesses in all cases where a supplementary business rate is planned this will simply be another tax on the wealth-creators of our local communities."

Miles Templeman, director general of the Institute of Directors, said: "The proposed introduction of an SBR will rock businesses, not least because such a move increases costs without any correlation to a business's profits or its ability to pay.

"Town halls will be more than happy to avoid a ballot box' revolt over council tax increases.

"The IoD recognises the important financial contribution that business can make to defined projects with agreed benefits to enterprise, such as Crossrail.

"However higher rates without a mandatory vote will only deepen the disconnect between local politics and the business community."

Tony Mernagh, executive director of the Brighton and Hove economic partnership, said the vast majority of businesses in the city would be exempt from SBRs. He said the restrictions on SBRs and the squeeze put on town hall purses following the comprehensive spending review meant the future of BIDS in Brighton was probably safe.