The government’s decision to postpone the 2015 business rates revaluation until 2017 is another blow to the already struggling high street with businesses now expected to pay rates based on “top of the market 2008 rents” for a further two years. It is a major blow, regardless of how this is dressed up by politicians as I can’t see how the postponement is of any benefit to businesses, under any guise.
Business rates are already far too high and are a cause of hardship and vacancies in the high street, because bills are based upon pre-recession rents. Businesses have already waited too long for the rating system to adjust to the state of the economy and to make them wait a further two years will cause much further hardship to the economy.
The 2015 revaluation would have been based on rental values as at 1st April 2013 and in essence when rent levels were depressed and probably at rock bottom. It would therefore have provided an opportunity to reduce rating assessments and rates liabilities for businesses in the region to take account of these falls in rents, and provide much needed respite for hard pressed businesses.
Having worked with the Lancashire Evening Post to raise our concerns over the impact on local business, their own research into the effects on Preston alone generated some startling facts and figures. It is claimed that the move is set to cost the City’s firms an estimated £13m by delaying the revaluation – vital funds which could have been used to inject back into the business and the economy. Preston council currently collects £65m from businesses for their rates bills and if this was reduced by the 20% outlined in the original revaluation plans, it would have saved a staggering £13m in Preston alone.