Chris Grose, rating director at property consultancy Hartnell Taylor Cook
The problem with business rates
The theory behind the rates system is simple, but until it functions simply in reality, businesses will continue to struggle to navigate a complex system based on outdated rental values. We need to reform the system, starting with delinking the rate in the pound – which should be a single, fixed rate that is not changed annually – from the total value of the rating list and removing reliefs as an anchor.
Reliefs are temporary by nature; they are signs of placation and not progress. Once introduced, they also prove hard to strip away. They can be served up as happy surprises that improve the mood, and this tactic has been seen plenty in recent years. But these reliefs skirt around the core problem: the need to get rid of any mismatches between rateable values, the rate in the pound, and their relationship to a market that has changed significantly since 1990.
Under-utilised appeals process
Where businesses might be missing a trick is with the appeals process, which is often underutilised. If businesses disagree with their rates valuation, avenues exist to dispute this with the Valuation Office Agency and, failing that, with a Valuation Tribunal. While this comes with some caveats – appeals must take place within a certain timeframe, and for a small fee – the savings this opens up in the long-term can be significant.
Government-backed reform
The government did have proposals for reform, but there still seems little intention to revive this campaign for a revision of rates. They are, however, interested in kicking the can as hard as possible down the road. With a hugely successful rate of collection business rates, it’s an effective way of keeping the money coming in, especially in a world where no one really wants to cover the tab. But if the government does want to keep the system they have, they would do well to strip it right back to the basics.
