Chamber calls for speedy action on business rates
HAMPSHIRE Chamber of Commerce is calling on the government to ensure struggling firms don't have to wait for much-needed business rate cuts.
The chamber said county businesses that had been expecting an immediate benefit from a long-awaited revaluation, due to take effect next April, could end up disappointed.
Stewart Dunn, chief executive, said he feared transitional arrangements designed to phase in changes gradually could end up taking far too long to implement.
He cited retailers as one group who needed action much faster than the five-year transition period earmarked by ministers.
Mr Dunn pointed to figures released by the Valuation Office Agency estimating that retailers in the south east stood to see an average eight per cent drop in their bills under the 2017 revaluation.
He said: ‘While that is good news on the face of it, we’ve had delay after delay from government over reform of business rates and they need to get on with it in earnest now. Where businesses have been assessed to have a lower rateable value or multiplier, why should they have to struggle on for another five years for the full rate cut to kick in? Companies could fail in that time as they wait for the light at the end of the tunnel.’
Mr Dunn added that business rate pain would continue to be felt by larger businesses in all sectors since the transitional relief system capped any reductions on bills in the first year.
Business rates take no account of profitability and are usually set every five years, based on the likely annual rent for which the property could be let.
However, the latest valuation was delayed by two years because the government did not want to see too many ‘sharp changes’.
That decision caused anger across the country as it meant rates continued to be set on pre-recessionary property values. Now, many commentators say the extra two years have done little or nothing to dampen dramatic rate changes.
Mr Dunn said: ‘We do expect to see some businesses in Hampshire, including retailers in urban centres such as Southampton, Portsmouth and Basingstoke, fare better compared to London, where rents continue to skyrocket. But it won’t mean much if they have to wait too long for any actual benefit on the bottom line.’
Business rate revaluation will be one of the topics under discussion at Roots to Growth, Hampshire Chamber’s fifth annual conference, taking place at Ferneham Hall, Fareham on Thursday, October 20. For more, go to hampshirechamber.co.uk.