Market Insight

Budget and business rates – what will change?

March 12, 2020

Yesterday’s Budget brought changes to business rates which will be beneficial for certain sectors of the market and smaller occupiers.

The changes announced included: 

  • An extension to the discount from 50% to 100% for next year for retail businesses with a rateable value of less than £51,000. This would effectively abolish business rates for these smaller businesses in the year ahead.
  • Extending this 100% discount to include retail, leisure and hospitality venues.
  • Promising a review into business rates reform for the longer term – to report in the Autumn.
  • Increasing reliefs to pubs, who already receive a £1,000 business rates relief- designed to help them stay as vital centres of their communities.

However, State Aid rules, as they stand, limit this relief and therefore remove all but the smallest businesses from the Government’s help.

Whilst helping SMEs in this way is to be applauded, there was nothing in the Budget to tackle the issues of larger businesses. 

The promise of “yet another” review of business rates, to be heard in the Autumn, seems non-sensical when the issue has already had a detailed review. 

The Treasury Select Committee gave its recommendations last November, many of which appear to have been ignored. 

One wonders what the point of all the expenditure in time and money was, if we are purely to review them again.

Unless business rates are properly reformed, as recommended by the Treasury Select Committee, these plans will do nothing to counter the impact of the 2017 Business Rates revaluation and the introduction of downward phasing. 

It simply won’t go far enough to help retailers struggling with their current rate bills.

To discuss the changes announced yesterday and their impact on your business rates liability, don’t hesitate to contact business rates expert, Danny George.