IT'S A START…
Andrew Hulbert, Director, Business Rates
Many will have welcomed Philip Hammond’s efforts in today’s Budget to address concerns from retailers, licensees and business owners around their bills, but not quite enough has been done by the Chancellor to alleviate them completely.
Most notably, the switch from the retail prices index (RPI) to the consumer prices index (CPI) has been brought forward by two years, to April 2018, a move which is estimated to bring about a benefit of £2.3 billion to small businesses over the next five years – something retailers and retail experts such as the Queen of Shops Mary Portas have been fighting for right up until the last minute.
Furthermore, the controversial ‘staircase tax’ will be thrown under the spotlight following a massive outcry from businesses affected by the ruling in Woolway (VO) v Mazar 2015, which sees offices operating from different floors of a building hit with higher bills. The ruling is to be overturned and previous valuation practice will be reinstated. The Valuation Office has taken a rather heavy-handed approach in interpreting the decision from The Supreme Court which has caused significant problems for both ratepayer and local authorities. It will be interesting to see how this proposal from the Chancellor is implemented by the Valuation Office Agency, especially in cases that predate 31.03.2017.
Licensees can breathe a sigh of relief as those pubs with a Rateable Value of £100,000 have had their £1,000 discount extended for a further year, until March 2019.
Future revaluations will now take place every three years, following the next, that is due in 2022. Three-yearly revaluations have been mooted by ratepayers and professional bodies alike for a number of years as they will allow Rateable Values to reflect what is going on in the market with a greater degree of accuracy, but introducing such a proposal will surely require the VOA being given greater resources – we understand that the agency is currently facing a further reduction in its workforce of 1000 staff, and it is already struggling with it existing workload… unless, of course, the Chancellor is considering the introduction of a controversial self-assessment system; but that is a conversation for another day!
Bringing forward the RPI/CPI switch, as well as extending the the relief period for pubs, will have a significant impact on business’ bottom lines, but there is insufficient detail with the remaining aspects of the Budget to offer full reassurance.
Along with most other Rating specialists – not to mention those grappling with it right now – we are disappointed that no announcement has been made about the much-maligned Check Challenge Appeal system, which continues to cause significant problems for ratepayer and local authorities. Maybe next time?