Agenda item

Purpose of Report

To provide the Joint Committee with an update on current issues within non-domestic rates.

Decision

That the content of the report be noted.

Alternative Options Considered and Rejected

None.

Reason for Decision

The following updates were noted:

Expanded Retail Discount

On 3 March 2021 the Chancellor of the Exchequer announced that eligible retail, hospitality and leisure properties in England would be granted 100% business rates relief from 1 April 2021 to 30 June 2021; and 66% relief from 1 July 2021 to 31 March 2022, limited to £2 million per business for properties closed on 5 January 2021, or £105,000 per business for other eligible properties.  Local authorities would be reimbursed if they used their discretionary relief powers.

In the recent budget there were some announcements regarding Non Domestic Rates although these were detailed at paragraph 4.7 of the report.

Nursery Discount

On 3 March 2021 the Chancellor of the Exchequer announced that eligible nursery properties in England would continue to be granted 100% business rates relief from 1 April 2021 to 30 June 2021; and 66% relief from 1 July 2021 to 31 March 2022, limited to £105,000 per business for other eligible properties. Local authorities would be reimbursed if they used their discretionary relief powers.

Discount for businesses affected by Covid-19

On 25 March 2021, the government announced funding of £1.5 billion for businesses affected by Covid-19, who had been unable to benefit from the existing relief for retail, hospitality and leisure businesses. It was stated that a ‘material change of circumstance’ would not be included in the criteria for obtaining the funds and detailed guidance had not been published, 

Fire Stations and Hospitals - Potential Reductions in Rateable Value

On 4 December 2020, the Valuation Office Agency (VOA) advised all local authorities that they might see changes in the rateable values of hospitals and fire stations, with reductions on average of around 10% on hospitals; and 9% on fire stations, depending on the age of the properties.

On 20 May 2021 the VOA advised that following a challenge to the proposed rateable values of court buildings, average reductions in rateable values of these buildings of 18% would be expected, with the reductions applying from 1 April 2017.

Business Rates Review

The final report for a Business Rates Review was also published at the Budget. The Budget and the Review committed in the longer term, to making improvements to the Business Rates system – these included the following;

More frequent revaluations, moving to a revaluation every three years starting from the next revaluation which would come into force on 1st April 2023, the next being 1st April 2026 and so on.

The process of revaluation would start approximately 2 years before the new valuations come into force. For the revaluation due on 1st April 2023, the rateable value would be assessed based on the rental evidence on 1st April 2021. There would be a new duty on the ratepayer to provide the Valuation Office with the information

 A new relief would be provided to support investments in property improvements. It was expected that this would include a 12 month exemption on an increase in the rateable value where a property is improved. However,  the final detail of this was not known at this time and the finer detail of this would be reported as soon as this was known.

There was a new exemption and relief to support green technologies announced. Unfortunately, again, the announcement was made without any of the detail being known and so, the finer detail would be reported as soon as this was known. A technical consultation had been announced on these points and we would respond to this when it was available.