The Government has announced the date that the new business rates assessments for commercial properties in the UK will take place.
After months and months of uncertainty as to when the revaluation would actually take place, the Valuation Office has confirmed the date as the 1st April 2017 with a valuation date of 1st April 2015.
Adam Rock, partner and head of rating at Bruton Knowles in Birmingham, welcomed the announcement, but said it is “too little too late”.
“It’s good that we finally have some certainty as to when the revaluation will take place but it still doesn’t hide the fact that it is two years later than it should have been, after the Government delayed the 2015 revaluation. Frankly, it is too little too late.
“Businesses have been paying rates based upon rental values based on 2008 market trends, when values were much higher than they are today. Whilst it is not ideal, the 2017 revaluation will at least bring rates back somewhere close to current market values and should hopefully result in reduced rates liabilities for ratepayers from 2017 onwards.
“Although values in 2017 may be slightly higher than they were last year, given the improving market conditions, we should expect to see a reduction in rateable values although we will have to see what the actual liability will be upon the release of forthcoming uniform business rates (UBRs), which is the multiplier used to calculate rates payment.”
Longer-term, Adam said a major overhaul of the rating system was needed to make it fairer on businesses.
Up until the 2010 rating list, rateable values were re-assessed every five years on a rolling programme.
The last revaluation was conducted in 2010. In 2012, Communities and Local Government Minister Brandon Lewis announced that the 2015 revaluation would be postponed until 2017, much to the dismay of ratepayers, rating advisers and business groups.
Since then there have been widespread calls for the Government to reverse the decision and to review the whole business rates system.
“The current system is fundamentally flawed,” said Adam.
“Rateable Values (RVs) along with the current Uniform Business Rates (UBR) sets what the ratepayer is liable for year on year. The RV is, in most cases, arrived at by establishing what is essentially a hypothetical rental value of the property at a specific point in time.
“Business Rates are therefore based upon the physical property that the business occupies. What we need is a fairer system, in which the calculated rateable value takes into account the type of business in occupation and not just the space they occupy at a snap shot in time.”