Government seeks to postpone Business Rates Revaluation
The Government plans to postpone the 2015 Rating Revaluation in England until 2017. The proposal is contained in the recent Growth & Infrastructure Bill which is expected to receive Royal Assent shortly.
Since 1 April 1990 there have been regular five yearly rating revaluations. Had the 2015 Rating Revaluation gone ahead, the rateable value of a property would have been based upon rental values as at April 2013 rather than at the pre-Lehman peak in April 2008. Here in Yorkshire we would have expected rateable values to fall and as a consequence to balance the books the Uniform Business Rate would have been increased significantly which would have been politically unacceptable as the revaluation would coincide with a General Election. This means businesses will have another two years to pay their rate bills based upon the Assessments attributed to their properties in April 2010. Consequently businesses should give further consideration as to whether an appeal is worthwhile in light of this development.
Chancellor George Osborne announced further proposals and changes to business rates in his Autumn Statement mainly relating to Empty Property Rates. Newly constructed buildings under the proposals would be exempt for a period of 18 months from practical completion if they are built between 1 October 2013 and 30 September 2016. In Kirklees there does need to be some form of incentive to developers to speculatively undertaken development, particularly in the industrial market where there is a shortage of modern units.
Small businesses will benefit from doubling of the Small Business Rate Relief Scheme and this has been extended to 31 March 2014, which is welcomed.
The Local Government Finance Act 2012 brings about a new scheme of business rates retention which will impact on the revenue the District Councils and County Councils obtain from business rates collection. As a consequence, authorities will either be winners or losers and in this respect we anticipate that many local authorities are unlikely to support applications for discretionary rate relief after 1 April 2013. Therefore, businesses should seek to take action in the current rate year as the changes do not assist landlords or businesses with rating liability on empty or partially empty buildings.
Written by Jason Metcalfe.