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Business rate revaluation postponed has major implications for businesses

wantspacegotspace.co.uk - Business rate revaluation postponed has major implications for businessesThe Government has stunned businesses with its intention to postpone the next business rates revaluation in England to 2017.

Officials claim that as business rates are the third biggest outgoing for firms after rent and staff, the measure will ensure firms don’t face unexpected hikes in their business rate bills over the next five years.

However business leaders, including Property & Rating Consultants Dunlop Heywood, are strongly disputing the overall benefits as the current 2010 Rating List was pegged to rents achieved in April 2008 at the height of the market. Had the Revaluation gone ahead in 2015 then the List would have been linked to rents as of April 1, 2013, showing a sharp drop in the last five years due to the recession and thus signalling a significant fall in Rateable Values  for many parts of the country.

Dunlop Heywood Rating Director Stuart Hicks says: “Overall, the Revaluation would not have led to a fall in tax revenue because the Government would have altered the rate in the pound (UBR) to compensate.

The result of postponing the Revaluation is really to prevent the tax base being reset. This would have allowed areas that have suffered as a result of the recession – i.e. secondary retail and geographical areas such as Yorkshire, the East Midlands, the  North West  and the North East - benefiting and being supported by lower Rateable Values.

“The other major problem is that 2008 values are artificially high being based on the Valuation Office Agency’s view of peak market values and, if anything, we need to bring the revaluation forward to enable the rating valuations to take account of the massive decline in market rents that we have seen in the majority of the country.”

Companies are now gearing up to lobby MPs and Ministers as a matter of urgency and Dunlop Heywood is keen to hear from any businesses who would like to add their voice to the debate. Email Stuart.hicks@dunlopheywood.com as soon as possible with your views.

Primary legislation for this has been brought forward through the Growth and Infrastructure Bill which will be laid before Parliament on October 30. Whilst this legislation only affects England it is expected that Scotland and Wales would follow suit.

Posted by The Editor (wantspacegotspace) on 23rd October 2012

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