In early July the Government pledged to base future business rate rises on the Consumer Prices Index (CPI) rather than the Retail Prices Index (RPI) measure, which rises faster and often outpaces growth.
Campaigners have long pressed for a change to the CPI inflation measure from the RPI rate because CPI rises more slowly and is increasingly considered a more accurate measure of growth.
“We are committed to switching business rates indexation from RPI to CPI from 2020 and will introduce legislation in due course,” a Treasury spokesperson told the Daily Mail newspaper. The switch should save businesses £1bn in the first three years, according to the Treasury.
There has been a call for the Government to do more however, as business rates bring in approximately £25bn a year therefore this saving amounts to just over 0.1 per cent of the revenue.
Proposals to reduce business rates were revealed in last year’s March Budget, and South Oxfordshire District Council have introduced three new schemes:-
Supporting Small Businesses – to assist ratepayers who as a result of the change to their rateable value at revaluation are losing some or all of their small business or rural rate relief and are therefore facing large increases in the bills. Early on SODC identified the ratepayers likely to be eligible and set up a special arrangement with them. Get in touch if you think you are eligible.
Supporting Pubs – Pubs with a rateable value under £100,000 if eligible will receive a £1,000 discount on their bill for 2017/2018. Eligibility criteria was issued by DCLG on 20 June 2017. Relief applications have been drawn up and issued to potentially eligible ratepayers on 11 July 2017 and applications are now coming in and being awarded.
New Discretionary Relief Scheme – The Government announced a £300m discretionary relief fund over four year period from 2017/2018 to support businesses facing the steepest increases in their rates bill following revaluation. Every authority will be provided with a share of the fund and are expected to discuss options with their major precepting authorities at an early stage and to consult them before adopting any scheme.
Whilst waiting for the promised further guidance SODC flagged potentially eligible accounts and have been in consultation with other Oxfordshire authorities to agree general principles of the scheme which will be agreed with Oxfordshire County Council.
FInd out more at this link to our business rates page.