IT was once the jewel of the English Riviera, known as much for its bright array of stores as its sunshine and gentle sea breezes. Yet the sparkle that characterised Torquay is starting to fade.

“All the shops I used to go to are not here any more,” said Gloria Murtagh, 64, as she scoured the streets for somewhere to buy an Easter egg. “It’s like the whole town is becoming boarded up - it’s very sad.”

A slew of closures, from the post office to Woolworths, and even the local pet shop, have blighted Torquay, transforming its welcoming smile to the leer of a gap-toothed old lady.

The Devon town’s woes, however, are far from unique. By the end of this year 139,500 shops will be vacant - equivalent to 15% of the UK’s retail floor space - according to Experian, the market analyst. In some towns the recession has hit so hard that up to 40% of outlets already lie empty.

Despite the gloomy figures, the government is expected to reject calls next month to freeze a 5% increase in business rates, which, along with other tax changes, will cost retailers an extra £1.6 billion.

Local authorities and opposition politicians warn that such tax hikes will result in more closures and job cuts as shops face the toughest conditions for 25 years.

This weekend the British Retail Consortium accused ministers of favouring the banking and manufacturing sectors for public bailouts. “Retailers are being left to carry the burden of extra tax increases,” it said. “Raising business rates will, in some instances, tip retailers over the edge. Taxes like these can cause a downward spiral in town centres from which it is very difficult to recover.”

In Torquay last week the scars of the downturn were all too visible. Six years ago only 6.8% of shops were vacant, but that has now risen to 22%. In a 700ft stretch of Union Street, a main thoroughfare, 16 shops are empty.

Three big retailers - Marks & Spencer, Woolworths and Zavvi, the music store - have closed in the past six months, and a string of smaller independent shops have also gone.

Kate Norris, 24, the owner of Chic, a women’s clothing store, is among those fighting to survive. “When I opened, business was booming, but now it’s just so quiet,” she said. “I can have a whole day when there’s not a person that comes in the shop.”

Torquay’s difficulties are shared by many other towns with traditionally affluent populations. In Ulverston, Cumbria, 21% of shops are vacant. This figure rises to 22% in Congleton, Cheshire, and 24% in Loughborough, Leicestershire.

To alleviate the problem, the Federation of Small Businesses is campaigning to abolish upward-only rent review clauses in shop leases that allow landlords to raise prices each year regardless of economic circumstances.

However, the move comes too late for Kevin Fowden, 54, who ran the Enigma gift shop in Torquay for six years before it closed in January. Fowden has since transferred his business to nearby Paignton, where he pays half as much for his premises.

“The rent was prohibitive in the end,” he said. “I took on the lease when times were very good, but the landlord was not prepared to negotiate. Because he was in London, I don’t think he realised the extent of what was going on here. Of course, now the unit is lying empty.”

High rents are also crippling Westcountry Flowers, which has been based in Torquay town centre for 14 years. Gary Wood, the owner, said he faced going out of business after his landlord demanded a rent increase of 50%.

Wood is also concerned that Torquay’s high parking charges - £5 for half a day - encourage customers to go to the Willows, an out-of-town shopping centre where parking is free. “It’s just terrible what has happened here,” he said. “It’s dead. The only ones making any money are the parking attendants.”

Torbay council, which covers Torquay, has responded to the criticism. Next month it will charge customers £1 to park in the town centre for the entire weekend. Last summer it displayed artwork in empty shop windows to boost morale.

The Local Government Association would like councils to be able to do more. It wants them to be granted emergency powers to take over empty stores for nominal rent and transform them into galleries and community centres.

Nick Bye, mayor of Torquay, said: “It’s not a dying town; it’s just that people are not spending as much as we’d like. High streets need to reinvent themselves to offer things shoppers can’t get in the big stores.”

One town bucking the recession is Berwick-upon-Tweed, Northumberland. Although its residents have an average wage of £14,214, the lowest in Britain, the number of empty shops fell in 2007-8. It now boasts thriving boutiques and its closed Woolworths will soon reopen as a home improvement store.

Phil McCabe, of the Forum of Private Business, said: “It’s a model for other towns to follow. It’s about getting away from the homogeneity of the high street.”

Additional reporting: Thomas Murdock

SOS: save our shops

Rates freeze Retailers want Alistair Darling, the chancellor, to freeze a 5% increase in business rates due next month

Upward rent review Clauses that allow landlords to raise rents automatically should be scrapped, argues the British Retail Consortium

Emergency powers Councils want to be able to take over shops vacant for more than three months and turn them into galleries, community centres and other public spaces. They would pay a modest rent

Vat cut Councils want the Vat rate to be reduced from 15% to 5% for the refurbishment of empty premises to encourage shops to reopen

Cheap parking Councils should no longer regard parking as a way of generating revenue, instead stimulating trade by charging less, the Federation of Small Businesses (FSB) argues. Councils raised £1.6 billion in 2005, the latest year for which figures are available

Planning Small businesses want the government to give planners discretionary powers to veto out-of-town shopping centres if there is a risk they could weaken the high street

Post offices They should be kept open if they are profitable, says the FSB.

LEAN PICKINGS

Britain’s worst-hit high streets (% vacant shops) Holyhead 39 Beckton, London 37 Rochdale 29 Blaydon, Tyne and Wear 28 Rotherham 26 Barry, South Glamorgan 24 Kirkintilloch, Glasgow 24 Loughborough 24 Llangefni, North Wales 23 Small Heath, Birmingham 23 Clydebank, West Dunbartonshire 23 Luton 22 Congleton, Cheshire 22 Elephant and Castle, London 22 Ayr 21 Ulverston, Cumbria 21 Kirkcaldy, Fife 21 Bootle, Lancashire 21 Houghton-le-Spring, Tyne and Wear 20

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