Chancellor Philip Hammond’s promise to bring business rates revaluation forward to 2021 and enable “fairer reflection of rental values” has come under fire from a number of business groups.
Real estate giant Colliers International has criticised the announcements made in the Spring Statement, saying it does “nothing to help those businesses, particularly the retailers who are struggling with the system today”.
John Webber, head of business rates at Colliers International, said: “The change from a seven year to a five year, then a four year and finally a three-year revaluation system, only underlines how the government has finally realised how disastrous the seven-year 2017 revaluation was.”
Webber believes the Chancellor has missed a trick by failing to properly tackle the issue of business rate reform, “leaving many businesses and retailers out to dry”.
Webber believes the consequences of the government’s decision to delay the business rates revaluation to 2017 and to introduce the policy of transition is coming home to roost.
“Some businesses, particularly those in London saw massive rises in their rates liabilities, some of which they needed to pay last year, but with the second big uplift coming this year, in addition to a 3 % inflation rise, they will be knocked for six.”
For example, a store seeing a 100% rise in their Rateable Value in the Revaluation, as experienced by several London stores, would have seen this translate into a 42% rise in its rates bill last year plus another 32% rise in its bill this year (plus 3% inflation).