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Lawbite: The broken rating system

  • United Kingdom
  • Litigation and dispute management
  • Real estate
  • Real estate dispute resolution

01-11-2019

The Treasury Select Committee’s report highlights the recent calls for meaningful reform to the business rates system.  The concerns have been growing, culminating most recently in a letter signed by over 50 retail bosses to the Chancellor, demanding four fixes to what the letter also described as a ‘broken’ system.

  • one - a freeze of the business rates multiplier;
  • two - fixing transitional relief;
  • three – the introduction of an “improvement relief”; and
  • four - ensuring that the Valuation Office Agency is fully resourced to do its job properly.

One of the main complaints with the current system is that it does not respond quickly enough to fluctuations in the market.  The Treasury Select Committee’s report will bring into sharp focus the adequacy of the present Government proposal of introducing new legislation that responds to this complaint, bringing the next revaluation forward by a year to 1 April 2021 and providing for revaluations every three years rather than 5 (albeit only in England, Wales is sticking with revaluations every 5 years).

Funding and resourcing remains a key issue. The Valuation Office Agency is already struggling with its current caseload and without a proper funding commitment from a future Government its struggles will only intensify with a move to a revaluation every three years.

The need for reform is well known, it is recognised by all involved, and whichever shape of Government takes office in December it will need to take meaningful action. The Treasury Committee are certainly clear upon that. 

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