Summer Budget 2015: Business rates update

Whilst Chancellor George Osborne’s Summer Budget did not reveal any startling revelations in terms of a much called for root and branch reform of the business rates system says commercial property agent Prop-Search, it did offer an update.

The Government has now published progress updates on action it is taking to improve the administration of business rates, including the appeals system and on tackling business rates avoidance.

The interim findings identified that too many rating appeals are made with little supporting evidence and that they take too long to resolve.  There is widespread agreement about the urgent need to introduce a more efficient system so that businesses can be confident that their valuations are correct and that they are paying the right amount of business rates.

Chris Billson, a Director at Prop-Search, said: “It has been suggested that a revised appeals system should be built around three stages - Check, Challenge and Appeal.  This will provide a structured and transparent approach in which there are clear expectations on all sides about timescales, requirements and action.  It will ensure earlier, more effective engagement between the parties and make sure that only appeals that really need to be heard by the Valuation Tribunal go through to appeal stage.”

The check stage will ensure that facts are validated by the ratepayer and agreed as far as possible.  If necessary the Valuation List will be corrected to reflect the facts. Where facts cannot be agreed, the differences will be clearly established.

The challenge stage allows a ratepayer to challenge the rating assessment.  They will put forward an alternative valuation and supporting evidence, and there will then be an opportunity for further discussion between the parties as necessary.  The Valuation Office Agency (VOA) will issue a decision on whether the Valuation List will be changed.

The appeal stage allows a ratepayer to appeal to the Valuation Tribunal for England (VTE).  The VTE will consider and make a decision on the case.

These proposals will be taken forward via enabling legislation in the current session’s Enterprise Bill, and the Government will be consulting on the details of implementation shortly.  Its aim is that the new system will be in place, following the next business rates revaluation, in 2017.

The Government has also summarised responses to the business rates avoidance consultation that closed at the end of February this year.  It concluded that further action is needed to curb avoidance and that these efforts will be co-ordinated with the ongoing business rates review, which is evaluating the effectiveness of reliefs and exemptions. 

Further information or advice on business rates can be obtained from Prop-Search - Tel: 01933 223300 / 01604 492000 or its website: www.prop-search.com