Business Rates Changes Come into Effect Today

From today, the new business rate multiplier will take effect. The multiplier has risen by 2% to 49.3p in England. This 2% increase is due to the cap on rates increases imposed by Government until 2016 – the rates increase would otherwise have been 2.3% in accordance with the September 2014 rate of RPI. Also from today, business rates will be fully devolved to Wales. This means that the revenue from business rates collected in Wales will remain there, and be redistributed amongst Welsh local authorities.

As announced in the 2014 Autumn Statement, the Retail Rate Relief scheme has increased from £1000 to £1500 for the 2015/16 year – effective from today (April 1st). Retailers with a rateable value of up to £50,000 will be eligible for this relief.

Many convenience stores will also be eligible for Small Business Rate Relief. The Small Business Rate Relief Scheme operates as follows:

  • Properties with a rateable value of below £6,000 are subject to a 100% rate relief discount until April 2016.
  • Properties with a rateable value of between £6,001 and £12,000 are subject to a tapering discount up to 100%, in place until 1 April 2016.
  • Properties with a rateable value of between £12,000 and £17,999 (£25,499 in London) are subject to the small business multiplier only (48p in 2015/16).

Public houses or petrol stations which are the only such business in a rural settlement, and which have a rateable value of less than £12,500, are entitled to 50% mandatory Rural Rate Relief, which can be topped up to 100% at the billing authority’s discretion. Sole shops, general stores or post offices with a rateable value of less than £8,500 are also entitled to this.

ACS chief executive James Lowman said: “We pushed hard for a cap on annual business rates increases and for the extension of small business rate relief, and we are pleased that today they are introduced, saving costs for convenience stores.  We now need to see fundamental change to business rates to encourage investment, make the system simpler, and promote a fair balance between all type of businesses.”

In March 2015, the Government published details of a fundamental review of the business rates system. ACS welcomed the review, and is currently consulting with members on the questions asked in the consultation.

This entry was posted by Chris on Wed, 01/04/2015 - 10:58