The Federation of Small Businesses (FSB) is a calling on members to urge their MPs to support a private bill that would make rate relief automatic.
The FSB is working with Tory MP Peter Luff, known to the trade as the chair of the Business and Enterprise Committee, to pioneer a Private Members Bill to make rate relief automatic for small businesses, as it is in Wales. The bill is due to be debated on 6 March in the House of Commons.
The FSB believes that around £400m in rate relief goes unclaimed each year.
"After rent and wages, rates are the biggest cost to a business and automatically getting the relief they are entitled to would be extremely welcome," said FSB national chairman John Wright.
"During the recession, this cash injection could save many small businesses from laying-off staff or closing down completely.
"Our members will be contacting their MPs to support their call for automatic rate relief — one of the key issues the FSB has been calling for in its Keep Trade Local campaign over the past year."
Ron Bailey, director of local works for the Campaign for the Sustainable Communities Act, added: "Communities are falling apart because small businesses are in danger. Making automatic the rate relief to which they are entitled would not only help small businesses stay afloat, it would also be a step towards keeping communities together. And this would in turn help with climate change as it would reduce the need to travel to shop and work."