Following some hard lobbing by businesses, some measures were announced to assist businesses with higher rates, given the new valuations coming into force from April 2017. This latest round of valuations will lead to significant rates increases, which further eat into profit margins.
Fears have been rising in the press regarding significant rate bill increases for pubs over the five year life of the new rating list to April 2022. Ratings valuations for pubs are complex and are based on factors including turnover, services and the area in which they operate. The measure announced today will mean that 90% of pubs in England will receive a discount of £1,000 off their rates bill in 2017/18. This is a one-off measure that is a drop in the ocean compared to increases in staff costs due to the living wage and the upcoming increases in national insurance.
Small businesses who lose their rate relief in the planned revamp will benefit from a cap of £50 per month on any increase. A £300m fund was announced for local councils to offer discretionary relief to some of those hardest hit by these changes.
The Government is set to consult on a better way of taxing the digital economy rather than bricks and mortar and will set out its preferred approach before the next revaluation cycle which is due in 2022.
A new formal appeal process is being introduced from 1 April 2017. Before that date only an informal review could be carried out if the valuation was disputed. There will now be a three stage process to ‘check, challenge and appeal’.
If you want to check the rateable value of your property you can do so at the VOA website: https://www.gov.uk/correct-your-business-rates