In the same week that Rishi Sunak presented his Autumn Budget and Spending Review, the Government published the conclusions of its review of business rates. As intimated by the Government’s Interim Report, it is not proposing to change the nature of the tax or the basis of basis of valuation, which whilst not surprising, might come as a disappointment to many of those who pay it.
The Government’s headline conclusions are to freeze the multiplier for 2022 to 2023, implement three-yearly revaluations from 2023 and to support the high street by providing a temporary relief for certain retail, hospitality and leisure properties for 2022-2023.
It also intends to introduce a new relief to support investment in property improvements and new measures to support green investment and the decarbonisation of non-domestic buildings, although we await further details of how these new reliefs and measures will work in practice.
Whilst the Government’s final report promotes the significant savings the above changes will have for businesses, it also makes clear “the paramount need to put the public finances on a sustainable path” following a prolonged period of unprecedented expenditure, following Covid-19, and that it considers “business rates will remain an essential component of the overall basket of business taxes”. It appears that, for now at least, the Government’s main focus is on protecting the revenue from business rates to avoid a huge hole in public finances. However, it will be interesting to see what the impact of the new reliefs will be to support businesses.
Perhaps with this in mind, the Government has also said it will shortly consult on introducing an Online Sales Tax which, if introduced, would raise revenue to fund business rates reductions. With most things moving online, it looks like business rates may be following suit!
If you would like to know more about Business Rates or the impact on you and your business, please contact me or your usual Charles Russell Speechlys advisor.
“The government is clear on the paramount need to put the public finances on a sustainable path and bring debt under control, and business rates will remain an essential component of the overall basket of business taxes.”