Ministers have announced plans to increase the frequency of the revaluation of commercial properties in a bid to ensure business rates bills more accurately reflect current property values.
Under the Non Domestic Rates (Lists) Bill introduced to parliament yesterday, revaluations will take place every three years rather than the current five years. The next revaluation will be brought forward a year from 2022 to 2021.
A property’s business rates bill is based on an estimate of the premise’s rental value. Business rates revaluations are intended to ensure this estimate accurately reflects the market value of the property and maintain fairness by redistributing the total amount payable across the country.
The 2017 business rates revaluation was the first for seven years and led to huge increases for some businesses, particularly in London and the south east, with many claiming they were unaffordable.
Local Government Minister Rishi Sunak MP said: “We’ve listened to businesses asking for more frequent revaluations and are now acting so their bills will more accurately reflect current property values.
“By bringing forward the next revaluation to 2021, we are making sure businesses can benefit from the change as soon as possible.”
MPs will next consider the bill at second reading, and a date for this has yet to be announced.
Earlier this month, a Commons treasury committee inquiry into the impact of business rates heard evidence from business and local government leaders calling for a complete overhaul of the business rates system.
One of those giving evidence was West Midlands CA mayor Andy Street. This week, he tweeted that our high streets are “in peril”. “But if coordinated action is taken now there is still time for them to thrive once more”. “The chancellor has made a brave start with business rate relief and a digital services tax - but we must go further.”
The UK is separately introducing a UK Digital Services Tax, which it says will be a narrowly-targeted tax on the UK-generated revenues of specific digital platform business models.