Government rates handling slammed
Oct 7 2009 By Jez Davison, Evening Gazette
BUSINESS groups have hit out at the Government's handling of the controversial revaluation of business property.
The Department for Communities and Local Government (CLG) claims that more than 50,000 North-east firms (67%) will see a reduction in their rates bill next year as a result of the five-yearly revaluation.
One million firms nationally will see an average decrease of £770 in 2010-11, according to CLG, while for those hit with a rise a £2bn relief scheme will phase in increases over the five-year period.
But confusion reigns over the exact amount businesses will have to pay.
The starting point for calculating the fee is to multiply the rateable value of the property by a uniform business rate set by Government. But the UBR will be re-based according to September’s retail price index, which will not be known until later this month. The Valuation Office Agency (VOA) website includes a link to a rates calculator - www.voa.gov.uk/2010 - which estimates what businesses’ bills could be next year.
But the CLG confirmed that the actual liability - which is based on several factors including premises type and relief eligibility - would only be known once businesses received their rates bill early next year.
The Federation of Small Businesses (FSB) said no company should see a rise while economic conditions were so uncertain.
Middlesbrough-based chairman John Wright said: “Any increase will make it difficult for some viable businesses to stay in business.”
The Forum of Private Business (FPB) said there was still “a great deal of confusion” among its members over the amount they would have to pay next April. Nearly four out of five (79%) respondents to a recent FPB survey believe their business rates will increase in April 2010.
The FPB’s Phil McCabe said: “There’s a lot of uncertainty at a time when businesses need certainty.”
The North East Chamber of Commerce (NECC) welcomed the £2bn relief package but called for more clarity on the revaluation. Head of policy, Ross Smith, said: “We need to make sure that any increases are not applied steeply and are properly communicated in advance so that businesses can plan and prepare for them. Cash-flow is still a major issue for businesses”.
