Member Article

CVS - Businesses set for increased rates in 2016

Business rent & rates specialists CVS has reacted to the news that businesses across England and Wales are set to see their business rates bills rise next year, following the publication of new official figures.

Ratepayers will pay up to 0.8% more in business rates, in line with the latest statistics on inflation.

Business rates bills are linked to the Retail Price Index (RPI) measure of inflation, published every September by the Office for National Statistics. The new bills come into force the following March. The latest indicators show that RPI fell from 2.3% in September 2014 to 0.8% in September 2015, meaning businesses will experience a smaller rise in business rates in 2016.

However, the official measure of inflation used for setting interest rates and pensions – the Consumer Price Index (CPI) – showed that inflation is currently 0.0%. Industry experts believe that it is unfair that business rates are not linked to this more reliable measure of inflation – one which would see no increase in business rates bills next year.

David Ford, Regional Performance Director at CVS, said: “One of the frustrations with the business rates system is that bills seems to bear little relation to what’s happening in the ‘real world’. Even the smallest of increases can mean hundreds or even thousands of pounds more in rates each year. Government reliefs for small businesses have become annual PR exercises at the despatch box and businesses ultimately need better long-term visibility of their overheads.

“The business rates system needs to be fairer and more transparent. The link to RPI is another sign that the current rates regime is clunky, archaic and not geared towards serving businesses. Switching the link from RPI to CPI is a simple measure which would mean less volatility and more clarity for businesses across the country.”

This was posted in Bdaily's Members' News section by CVS .