Supplementary Business Rate
Businesses in the UK currently pay national business rates set according to the ‘rateable value’ of the business property and a ‘multiplier’ set by central government. In his Pre-Budget Report to the House of Commons, the Chancellor Alistair Darling confirmed that local authorities would be permitted to levy an additional supplementary business rate of up to two pence in the pound, in order to raise revenue for local projects. The Government believes it will “enable local communities to take decisions about how to use local funds” and “ensure that local priorities are being met.”From 2010 upper-tier local authorities as well as the Greater London Authority will be able to levy the rate on any business within their jurisdiction. Properties liable for business rates but with a rateable value of less than £50,000 will be exempt from the Supplementary Business Rate (SBR). The revenue generated from the SBR will be locally raised and retained and it will only be able to be used on economic development such as infrastructure. Already the London Mayor Ken Livingstone has expressed his desire to levy the SBR in order to raise funds for the Crossrail project.
Where revenue from the SBR will fund more than a third of the costs of a particular project, then the businesses which pay the SBR will be able to vote on the project and the use of their funds.