Editor: When Michael Gove acknowledged his new position as secretary of state for levelling up, he vowed his “relentless focus will be on delivering for… undervalued communities across the UK” (‘Michael Gove appointed housing secretary’).
Let’s hope this is more than rhetoric and Gove turns his attention to the issue of business rates, which in their current form are doing much to strangle business growth and destroy the high streets in our communities.
After four delays this year, we are still waiting for the government to respond to its consultation on business rates reform, promised for the autumn, despite the industry making it clear for years the reforms that are needed.
The system in current form is unworkable. Overall rates bills need to be lower, the multiplier (UBR) cut to 30p – more manageable than the current 51p in the pound tax – and the burden of this taxation should be shifted away from the retail sector, which contributes over a quarter of the total tax take.
Rates reliefs should be reformed, empty rates relief extended and plant and machinery clauses reformed to encourage investment. We need more frequent revaluations so rates better reflect values and an overhaul of CCA, the disastrous appeal system. The industry agrees all these points. Why is it so difficult to get the government to listen?
So far, its response has been ominous. The outlawing of Covid MCC appeals, making it impossible for businesses affected by Covid-19 to appeal their rates bills, is a retrospective tax and sets a dangerous precedent.
And while the government suggests a move to three-yearly valuations, there is no further support to the VOA to achieve this – putting a greater administrative burden on businesses to notify about their properties. This will just lead to a more onerous and expensive way for businesses to appeal their rate bills.
Meanwhile, the latest figures from LDC reveal that more than 17,500 retail chain outlets disappeared last year and nearly 190,000 retail jobs were lost.
So come on, Mr Gove. Please put your head together with the chancellor and come up with a sensible approach to fundamental business rates reform. Businesses and our communities do not need or deserve to wait any longer.
John Webber, head of business rates, Colliers