Just as private resident council tax is levied upon private residential property, business rates are levied upon business properties. With hikes from last year’s revaluation they are viewed as disproportionally high by most business owners and are a contentious issue when considered against other business overheads and exacerbating challenging business conditions.
Based on the value of a commercial property (local authorities retain 50% of the rates and the Treasury also collect 50%), the Government has been called upon to reconsider rate rises, in part because the value is obtained from ‘potential’ rental value per square metre, then put through the mathematical equivalent of an Ironman fitness test (multiplied and multiplied again).
The Chancellors’ Spring Statement announced some modification to on-going reform of the business rates system, with the next scheduled tax levy being brought forward by one year, from 1 April 2022 to 1 April 2021, and the time between valuations being reduced to three-yearly revaluations – the next being 2024.
