Business Rates - government slammed for lack of clarity

The government has failed to take the opportunity of the Spring Statement to provide clarity on its business rates reform agenda, a leading agency claims.

John Webber, head of business rates at Colliers, says: “Although this was primarily a “consumer led” Spring Statement … it was disappointing that the elephant in the room - business rates - was largely ignored, despite the impact that ultra-high rates bills has had on businesses in recent years.

“The Chancellor reiterated the 50% business rates discount for the retail, leisure and hospitality sector as of April 1 but with a cap of £110,000 per company, this will only support the smallest businesses in the sectors and will do little to help the larger companies who account for the majority of jobs. 

“Any support to businesses in other sectors of the economy was also totally lacking.”

He also warns that the promised revaluation next year may mean bills will come down for some business sectors, “but this will be meaningless if the government does not allow business rates reductions to be implemented immediately rather than spreading them over the years of the list in a transitional arrangement as it did in the last list of 2017.”

Webber adds that business rates have been a key influence in the demise of Toys R Us, Laura Ashley and other high street brands and had a major impact on the high streets of many of the UK’s provincial and poorer towns - areas of the country the government claims it now wishes to “Level Up.”

He continues: “Retailers and other high street operators will be now considering their business plans now for next year and looking closely at their future business rates liabilities, particularly when the Covid-related reliefs come to an end. 

“It is essential the Chancellor provides reassurance that rates bills next year will immediately reflect the lower rents we are seeing in the market now -providing incentives for businesses to keep or expand space and for property investors to invest in the sector across the UK.

“Without this reassurance the government’s levelling up agenda will be meaningless. And the high street unlikely to get back on its feet.  We are disappointed the Chancellor was not more forthright in his statement.”