The Conservatives have pledged to abolish business rates for high street shops and pubs if they win the next general election, in what they describe as a plan to revive local economies and protect jobs.

Shadow chancellor Sir Mel Stride announced the policy during his speech at the Conservative Party conference on Monday, saying that the “burden of Labour’s tax rises” had been “simply too much to bear” for many businesses.

“I can announce that as a direct result of getting public spending under control, a future Conservative government will completely abolish business rates for shops and pubs on our high streets,” he said. “End of. Finished. Gone.”

The move, expected to cost around £4 billion, would see 250,000 retail, hospitality and leisure businesses benefit, with councils “fully compensated” through central government funding.

Sir Mel framed the plan as part of a “radical” economic programme that would also involve cutting £47 billion from public spending. Proposed savings include shrinking the Civil Service to its 2016 size, restricting welfare payments, and reducing foreign aid to 0.1% of national income.

He argued that the measures were necessary to balance the books while still supporting enterprise, adding that the Tories would only cut taxes “when it is affordable.”

The pledge comes as business groups continue to call for deep reform of the business rates system. Rain Newton-Smith, chief executive of the CBI, said the cuts could help struggling high streets but urged the Conservatives to “go further” with longer-term reform.

Shevaun Haviland, director general of the British Chambers of Commerce, said: “The BCC has long argued for fundamental reform of business rates to create a system that is fair and affordable. While reviving our high streets is important, any changes must go further and benefit businesses of all sizes.”

Labour criticised the announcement, accusing the Conservatives of “making a multibillion-pound pledge without explaining how they’d fund it.”

“The same old Tories with the same old policies,” a Labour spokesperson said. “They didn’t work then – and you can’t trust them now.”