The Chancellor announced a ‘package’ of business rate measures as follows:
The switch to CPI was originally due to come in in 2020 so has been brought forward 2 years. This measure just about qualifies as ‘good news’ as CPI is usually lower than RPI and therefore the increase in rates payable, going forward, might be slightly lower.
The 3-year revaluation cycle is ‘old’ news. The government (VOA) signalled that this would happen some time back. Shorter gaps between Revaluations should and we emphasise should, mean that the change in values between Revaluations will be less extreme but, this cannot be guaranteed. Much of the problem with the 2017 List Rateable Values (RV) was that the Government extended the gap between Revaluations to 7 years from 5.
The promise to legislate to reinstate the previous VOA practice where physically non-contiguous elements of a property can be valued in the same RV comes under the category of a ‘victory for common sense’. To those au fait with the Supreme Court case judgement in Woolway v Mazars (2015), this announcement raises a wry smile: For those blissfully unaware of ‘Mazars’ this infamous case gave rise to what the Tabloids call the ‘Staircase Tax’. This court case was won by the VO and concerned two floors of a multi-occupied office building. Originally valued as one RV the Court found the VO was ‘correct’ to rate the floors separately. However, the ‘Law of Unintended Consequences’ means that whilst this case related to floors in a ‘prime’ office building it also applies to small businesses occupying a couple of rooms, car spaces etc. At a time when the VOA is under pressure to conclude appeals under the 2010 List let alone the 2017 List, splitting thousands of assessments means a huge increase in workload not to mention the pressure it is putting on the billing authorities. The losers here include small businesses who lost their rates exemption due to a technicality, as they suddenly had more than one RV and no longer qualified. Perhaps the biggest injustice was that additional rates payable due to this case could be back dated to 1 April 2015. We will wait to see how quickly this ‘promise’ is actioned and on what terms. If you are affected call us.
Also announced were the provisional small business non-domestic multiplier for 2018 – 19 as 48.0p and non-domestic multiplier as 49.3p in the Pound:
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