19 September 2016 09:45
Winners and losers in the big rates shake-up
Retailers in 11 out of 14 UK cities could be better off next year when their average rateable values go down in the 2017 business rates review.
Cities including Aberdeen, Leeds, Cardiff and Bristol will all see their average values decrease by over 30% according to analysis from CBRE. However, in Central London, rateable values could rise by as much as 170%.
CBRE's analysis shows the percentage rateable value movement from 2010 to 2017, ahead of the next rates revaluation and the publication of the proposed values by the Valuation Office Agency on 30th September.
However, the decrease will not be felt across the board and some retailers are likely to see an uplift on 1 April 2017. And the CBRE warns that, with the cumulative rateable value set to fall across the UK, the Government "will be seeking to maintain the level of tax generated by the business rates system". Therefore, it says, "the multiplier will be higher than we've ever seen immediately after a revaluation. Retailers should be aware of what the potential changes might be, and the impact on their business."
In addition, the Government has recently established a consultation that could change the business rates appeals process. The regulations state that the Valuation Tribunal will only order an alteration to the rateable value of a business if it considers it to be "outside the bounds of reasonable professional judgement".
Tim Attridge, Senior Director, Rating at CBRE, said:
"Yes, there is the option to appeal, but this will be a very protracted process and the definition of 'reasonable judgement', is far from clear. With this lack of clarity, the key is for retailers to budget accordingly now, review their strategy and ensure they have sufficient funds in place to either challenge, or adapt to a new system in order to survive."