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Research has showed that over £16 million in business rates was levied on empty properties in Northamptonshire during 2011/12, reports commercial property agent Prop-Search.
The Taxpayers' Alliance, which collected data from Freedom of Information requests, claims councils across the County collected £16,289,620 in empty property rates over the financial year - a rise of 11%. The highest unitary authority was Northampton which levied approaching £8 million.
Ian Harman, a Director of Prop-Search, said: “It is clear that charging empty business rates is an unfair burden on tax-payers and is potentially restricting economic growth. Nationally, commercial property owners were hit by a £1.1bn tax bombshell in 2011/12, a rise of 19% since 2009/10. This is having a devastating effect on landlords, with some demolishing properties rather than paying the full rates while unable to find tenants.”
Relief had traditionally been provided to landlords with empty shops and offices, exempting them from business rates for the first three months and charging then at 50% thereafter, with industrial properties totally exempt. However, in the 2007 Budget, it was announced that after a three-month exemption period for shops and offices and a six month exemption for industrial properties, full business rates would be payable on all empty premises.
Ian Harman added: “Many companies have properties which are no longer required for operational purposes. With outgoings such as rent, service charges, insurance, these properties are a drain on a company's finances and with empty rates charges, these costs are escalating massively. Empty rates go totally against the whole concept of rating which is that rates are a tax on the benefit received from the occupation of land and buildings.”
The only exemptions are where properties have a Rateable Value less than £2,600; are listed or subject to a preservation order; where occupation is prohibited by law; or a liquidator/administrator.
Some relief was offered in this year's Budget. It was announced that empty new build commercial properties will be exempt from empty property rates for up to 18 months - up to state aid limits between 01 October 2013 and 30 September 2016. However, this 18 month period includes the initial three or six month exemption.
It should also be noted that from April 2013 the small business non-domestic multipler has been increased to 46.2p and the standard non-domestic multipler to 47.1p. This means that every rates bill has increased!
Further information or advice can be obtained from Prop-Search - Tel: 01604 492000 / 01933 223300 or its website: www.prop-search.com