Government plans to postpone business rates revaluations have been slammed as an “underhand tactic” to rake in even more cash from already-squeezed businesses, according to a senior Bristol property figure.
The proposals, announced last week, have also been described as a bombshell by Martin Davenport, partner in charge of business rates at Bristol commercial property consultants Hartnell Taylor Cook.
The changes put back the revaluation of business rates from 2015 to 2017 – effectively meaning businesses must pay market-topping 2008 rents for a further five years.
In addition, by the time the revaluation does take place in 2017, it will be based on 2015 rental values, which are expected to be higher than 2013 figures.
“It’s a shocking decision and completely flies in the face of previous statements that this Coalition Government is pro-business,” said Mr Davenport.
“The current rates are massively out of line with the rest of the economy. It’s bad enough as it is – now under these proposals retailers will have had to wait a full seven years for some kind of respite.”
Business rates, which are based on the open-market rental value, are revaluated every five years. The last round took place in
2010 and was based on 2008 rental values which at the time were at a record high at the top of a booming economy.
As a result, business rates have remained at that same unsustainably high level, despite the UK sliding into the deepest recession for generations.
Mr Davenport continued: “In making this announcement the Government claims its decision will ‘remove uncertainty’ and ‘assist future budgeting’ with the ultimate aim of ‘supporting local economic growth’.
“In fact it will have the polar opposite effect and to come out with this now, and to wrap it up as some kind of ‘gift’ to hard-pressed businesses, is completely out of order and does nothing to the country’s economic prospects other than push us even further into the mire.
“This is nothing less than a bombshell from a Government which claims to back businesses and the high street, but which in reality seems intent on hammering them whenever they spot the opportunity to do so.
“It’s another example of retailers and other businesses being squeezed for every penny, and it's just not sustainable.”
He called on the Government to pull the plug on the proposals now and reinstate the 2015 revaluation if it really wanted to demonstrate its commitment to growth. And at the same time it should remove “punitive” rates on empty property, he added.
