In a surprising last minute statement, the Chancellor advised yesterday (31 March) that the change in the Uniform Business Rate (UBR) for England, due to go up 5% from 1 April 2009, would only actually rise by 2%.
The UBR is the multiplier used to calculate non-domestic rates bills from a property’s Rateable Value. The draft proposal of a 5% increase, linked to the rate of inflation towards the end of last year has been on the table for some time, and business has been arguing that such a rise in the current climate was unjust.
Many local councils have already sent out 2009 rates bills based on a 5% increase. These bills will now need to be recalculated and re-issued.
Paul Malam, a Partner in Carter Jonas' Minerals & Waste Management Division, commented:
“This is welcome news for industry, currently struggling with the heavy rates burden, although the Chancellor could not have advised the change any later!”
He continued: “Looking at the bigger picture though, the outlook may not be so rosy. Alistair Darling has stated that lost revenues from this cut will be clawed back by the Government by 'smoothing' the remaining 3% over the next couple of years. The forthcoming 2010 list is already expected to see hikes in base Rateable Values, and increasing the UBR further at that point to recover monies will only serve to increase pain at a time when businesses are still likely to be struggling with costs.
“In addition, the Chancellor needs to urgently review a range of issues relating to non-domestic Rates, in particular the massive impact that the cessation of empty property relief is having on business occupiers with empty or unused premises.”
Business Rates payers should now take steps to ensure accurate bills are re-issued by their local billing authorities.
Carter Jonas' Minerals & Waste Management Division advises a wide portfolio of clients in the extractive, waste management and heavy manufacturing industries on their rates assessments, and has a long track record of achieving excellent savings. Our specialist Minerals Surveyors are able to offer advice on rates appeals, void applications and billing accuracy.