Partner Article

Postponing rates will tighten noose on Northern retailers

The government’s announcement today that it will seek legislation to postpone the 2015 Rating Revaluation in England and Wales until 2017 marks a blind spot in the government’s vision warns Richard Farr, Partner for Rating at Sanderson Weatherall LLP.

The failure of the government to review rates in accordance with the mandatoryfive yearly timetable would not only be detrimental to those currently paying pre-recession basedrates, which in many cases are far too high, it will also serve to widen the North South divide.

Those in lucrative locations such as London and the south-east, where rental values have increased will benefit from the move whilst hard hit retailers in Northern cities and elsewhere will continue to be suffocated by being charged business rates based on pre-recession values. The object of a revaluation is to re-assess properties, both upwards and downwards and not to just increase rates bills for all.

Retailers already face some of the toughest trading conditions in decades and this move will not serve to “avoid local firms and local shops facing unexpected hikes in their business rate bills” as Mr Lewis, The Parliamentary Under Secretary of State for Communities and Local Government claimsbut in short it will see many businesses continuing to pay far more rates than they should.

The reality is that the recovery of business; in particular high street retailers has been and willcontinue to be hindered by business rates which are based on 2008’s pre-recession valuation.

With daily shop closures, the government needs a more considered approach to instead promote a carefully planned revaluation coupled with a review of the transitional charging arrangements, if it isto restore some much needed vitality to the economy.“

This was posted in Bdaily's Members' News section by Sanderson Weatherall LLP .