Next business rates draft list due next week

The business community will be delighted to hear that the next rating list will be released in draft form next week. This will no doubt result in a tsunami of letters and tele-sales calls from the good, the bad and the ugly of the rating profession with many, many variations of ‘who does your rates?’!

Despite the imminent release, the government has remained tight-lipped about two rather large elephants in the room: Transitional Relief and Small Business Rates Relief.

What is Transitional Relief in practice?

Transitional Relief is a complex mechanism designed to limit substantial increases or decrease in rates liability. It is cost-neutral by design, with those getting a benefit being ‘paid for’ by those who would have seen reductions. Applying the same principles adopted on previous rating lists to April 2023 bills, occupiers of industrial/warehouse properties whose Rateable Values are likely to increase dramatically will have their bills capped. Meanwhile those in retail properties would have to wait several years to get the full benefit of the rateable value reduction.

Recent TR consultation saw widespread calls for it to be scrapped in its entirety, something that’s already occurred in Wales. Either way it seems laughable to publish new rateable values without any way to confirm the actual liability.

What about Small Business Rates Relief?

Small Business Rates Relief is in the same boat. The current scheme in England provides 100% relief for occupiers with a single property with a Rateable Value under £12,000 and a sliding scale between £12,000 – £15,000.

Will these bands change to reflect increased RVs in the industrial sector? Again who knows – but it easy to see how RV increases could push some occupiers out of the current RV scale and into 100% liability.

If TR is retained then the government need to continue with some form of retail discount. It was initially introduced as a stop gap, then its reach extended to provide support during and after Covid. I sincerely hope that we don’t have some repeat of the farcical Covid Additional Relief Fund scheme – the £1.5bn pot that took too long to release, with the mechanics of application left to the discretion of each council. The whole process has turned into a pantomime and the last time that stats were published in June, only 28% had been awarded. No stats since June? I wonder why…

Let’s hope that the forthcoming autumn statement includes some clarity.

We’re going to be looking at draft list figures across the region in coming weeks so if anyone would like us to look at a sector or location in particular then please get in touch. Email richard.roberts@rvwcs.co.uk or call me on 07881 503540.