The end of the government’s consultation period on business rates has led a number of bodies to call for business rates to be revalued every year.
The British Property Federation said fundamental business rates reform was “long overdue”.
BPF CEO Melanie Leech said: “The business rates system is undermining town centre recovery and poses a significant risk to the future of our high street businesses.
“Business rates have become so unaffordable, they are now hampering town centres’ ability to adapt, modernise and thrive.
“We welcome this first step to increase frequency and transparency of revaluations, but the government must recognise it is only the beginning of the journey to create a more sustainable and fairer system.
“We need annual revaluations and transparency over how valuations are determined; more frequent revaluations is only one piece to the jigsaw.”
UKHospitality and the BII have welcomed the opportunity to comment on the Government’s Business Rates Revaluations Consultation and supported the proposal to increase the frequency of evaluations to three-yearly revaluations – but warned that this could not come at the cost of extra reporting, restrictions on appeals and penalties
The trade bodies recognised the helpfulness of the consultation in addressing one area of reform, they stressed the need for more wide-ranging reform to redress the unjust and imbalanced current system, and the need to move taxation away from property.
The pair said the hospitality sector overpaid by 300% relative to its turnover in the current system, following the pandemic this already unfair system would put further pressures on heavily indebted businesses as they begin to rebuild and repair balance sheets.
The trade bodies were also concerned about a number of further proposals included in the consultation, which would put a significant administrative burden on hospitality businesses, and therefore propose that:
Businesses are not asked for more information than they currently are at revaluation: the need to report amendments mid-list is burdensome and will actively discourage investment in the sector at a critical time.
The move to more frequent revaluations be considered as part of the broader review of business rates – which should be designed to reduce, not increase, the burden on ratepayers.
The Valuation Office Agency should enhance its technological systems to facilitate data returns at valuation.
Businesses should not be charged for challenges, nor should there be fixed windows in which to bring a challenge.
Government should consider minimising the time between the AVD and the new list to 18 months or lower.
In a joint statement the trade bodies said: “The current business rates system has long been unfit for purpose and puts an unfair burden on pub and hospitality businesses. It’s extremely encouraging that the Government is proposing to increase the frequency of revaluations, something for which we have been calling for some time. However, the proposals are severely undermined by administrative burdens, limits on appeals and penalties.
“It’s vital that government reforms match the severity of this issue. This proposal is helpful but does not redress the wide-ranging issues with the current system that will severely hamper the sector’s ability to recover from the pandemic if not addressed. We urge the government to work closely with the sector to implement wide-ranging reform that will empower hospitality businesses, to rebuild and repair revenues, create jobs and be at the forefront of the economic recovery.”
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