Business rates appeals reform comes at a cost

Proposals to create a more efficient business rates appeals system have been launched by the Government in a bid to deter speculative appeals, says commercial property agent Prop-Search, but at a cost.

The Government has published a consultation paper which proposes that a fee in the region of £100 and £300 would be charged for anyone looking to lodge an appeal, aimed at curbing appeals from agents operating on a ‘no win-no fee’ basis.  This fee would only be refundable to those whose appeal is successful.  Furthermore, a civil penalty of up to £500 is proposed for any false information provided by a ratepayer or professional representative, whether knowingly, recklessly or carelessly.

Samantha Jones, an Associate Director at Prop-Search, said: “Many businesses have complained in the past of the time it takes for an appeal to be resolved and indeed the Government’s interim findings identified over 850,000 appeals have been submitted against the rating valuations for the 2010 Rating List.  Around 70% of these resulted in no change to the rateable value and less than 2% proceeding to a tribunal heating.”

Under the proposed reforms, appeals would go through a three stage process - Check, Challenge and Appeal.  The check stage would ensure that facts are up-to-date and accurate, with any agreed errors corrected; challenge would allow businesses to challenge the rateable value of their premises with the opportunity to put forward an alternative valuation with supporting evidence; and finally the appeal stage which will offer the ratepayer the opportunity to appeal to an independent valuation tribunal.

In launching the consultation, Local Government Minister, Marcus Jones, said: “The business rates appeals process has been in a decades-long deadlock, hampered by some unscrupulous agents making speculative appeals.  A key part of our long-term economic plan is to turn this around and streamline the system, which is why we’re proposing a straight-forward 3-stage process so people can check, and challenge their valuations and be confidential they’ll get a fair deal.”

The deadline for responses to the consultation is 04 January 2016 and subject to parliamentary approval, will be implemented using the extended enabling powers contained in the Enterprise Bill. 

The Government has already set out plans to devolve powers to local government by the end of Parliament, resulting in local areas retaining all revenue raised from business rates.  The Government will also abolish the Uniform Business Rate and give local authorities the power to cut business rates to boost enterprise and economic acidity in their areas. 

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