To make West Berkshire the best place to start and grow a business
With TVCC CEO Paul Britton after speaking on the outlook for 2017 at the TVCC Future of Work event in February
Government support for small businesses
The Government has recognised that business rates represent a high fixed cost for small businesses and announced in the Budget 2016 (and recommitted in the Autumn Statement 2016) that starting from 1st April it will:
Permanently double Small Business Rate Relief (SBBR) from 50 per cent to 100 per cent
Increase the thresholds to benefit a greater number of businesses
Give 100 per cent relief to businesses with properties with rateable value of up to £12,000
Ensure tapered relief for businesses with properties with rateable value between £12,000 and £15,000
Increase the threshold for the standard business rates multiplier to a rateable value of £51,000, taking 250,000 smaller properties out of the higher rate and reducing business rates for many small businesses – including some high street shops
This means 600,000 small businesses, occupiers of a third of all properties, will pay no business rates at all – a saving worth up to £5,000 in 2017-18. An additional 50,000 will benefit from tapered relief.
The Government will also remove the inconsistency between Rural Rate Relief and Small Business Rate Relief by doubling Rural Rate Relief to 100 per cent from 1 April 2017.
All this means that the business rates bill across West Berkshire is expected to fall by 5.2%.
If you own a business that is currently not receipt of business rate relief and you think it should, then contact the Valuations Office Agency: https://www.tax.service.gov.uk/contact-finder/start
In the Spring Budget the Chancellor announced a further package of relief. This included:
No business losing Small Business Rate Relief will see their bill increase next year by more than £50 a month
The subsequent increases will be capped at either the small business transitional relief cap or £50 a month, whichever is higher
A £1,000 discount on business rates bills will also be provided in 2017 for pubs with a rateable value of less than £100,000
Local authorities will be provided with a £300 million fund over the next four years to deliver discretionary relief to target individual hardship cases in their local areas. Taken together, this represents further £435 million cut in business rates
What I have been doing to challenge the Government
There are anomalies in the revaluation calculations. The equestrian industry is an important employer and contributes greatly to local communities in this area. However, they have been hit unreasonably hard in the latest revaluation. I am working with other Members of Parliament to make the Valuation Office Agency (VOA) and the Government aware of this anomaly and get a better deal for equestrian centres in the Newbury constituency.
I have also been campaigning for reform to the VOA. Its decision-making lacks transparency and accountability. There are also serious inconsistencies in its decision-making where the difference in rating of two similar size businesses, in similar areas, can be huge. Likewise, the number of appeals to the 2010 rating stood at 1.04 million in September 2016. Of these challenges, 764,000 had been resolved and 29% of these saw a change in their rateable value. This is a similar picture to the 2005 rating where 37% of challenges saw a change in their rateable value.
The VOA is rightly an independent body but it has become increasingly clear that there are too many inconsistencies in how they rate businesses. This is costing both businesses which have been unfairly rated and local authorities which are expected to pay back tax receipts should a business win an appeal.
Effect on West Berkshire Council
West Berkshire is a net contributor in the current allocation of business rates nationally. Whilst local authorities technically retain 50% of business rates raised in their area, because West Berkshire is a ‘tariff authority’ (ie its business rates income is deemed to exceed its need) a further tariff is applied taking retention down to just 21% of business rates. Additionally, when there are changes to the business rates collected, for example if a business is moved on to a different rating list or there is a successful appeal, this tariff is not automatically adjusted which means, as has happened in the past, West Berkshire loses further income.
I want the Government and the VOA to guarantee consistency of business rates, so local authorities can better plan their expenditure. I am also challenging the current retention rate which is placing severe pressure on a successful well-run Council such as West Berkshire.