£150m In Tax Rises For 56,000 Shops Next YearThursday, October 26, 2017
CVS data reveals 56,068 shops in England are set to see inflation-busting property tax rises totalling £151.78million next April.
Business rates increase annually in line with September’s Retail Price Index which the ONS last week reported at 3.9%.
But, under the revaluation, which came into effect on 1st April, transitional relief means big increases to bills are phased in gradually over the 5 year Rating Period.
The ‘caps’ for 2018/19 limiting increases in bills are 7.5% for small properties, 17.5% for medium and 32% for large properties to which the effects of September’s RPI is then added.
Small properties are defined by the Government as those with a Rateable Value of less than £20,000 and £28,000 in London. Medium sized properties are classed as a Rateable Value of up to £99,999 with large properties being defined as those with a Rateable Value of over £100,000.
The Rateable Value of a property is the annual open market rental value on 1st April 2015 and, under this year’s revaluation of business rates, will determine tax bills for business rates for the next 5 years.
Our research shows that 37,364 small shops will see their business rates bills rise above inflation with 30,198 small shops facing rises in their rates bills of between 10% and 14.99%.
The research also shows 16,489 medium sized shops will see above inflation rises in their bills with 10,542 of those shops facing increases over 15% totalling £34.40million extra in tax, an average hike in tax of £3,263.
We believe that 2,215 large property shops will see increases above inflation in their tax bills next year with 945 facing average increases each of £46,153 in tax with hikes of over 30% totalling an extra £43.61million.
We’re urging the Chancellor to be "bold" in his Autumn Budget and freeze inflationary rate rises next year.
The news comes as fewer than half of all Councils in England have issued revised business rate bills following the introduction of a £300m discretionary relief package at the Spring Budget, figures released this week by the Department for Communities and Local Government reveal.
Just 157 out of 326 Councils have told the Department for Communities and Local Government that they have reissued bills allocating their allowance under the initiative.