Message from Dr Adam Marshall, Director General, British Chamber of Commerce
Monday 20 February 13:26
Our fight against some of the worst elements of the business rates system continues this week, after a period of intense activity both behind the scenes and in the media to get the UK government to reconsider some of the consequences of this year's revaluation.
While Ministers continue to insist that more businesses will see a rate cut than a rise, their indifference to the half-million companies that will see rates bills rise up to 42% year-on-year is unacceptable.
As we noted in the BCC's Budget submission, the key issue here is the government's insistence on a fiscally-neutral revaluation. That effectively means that some businesses will have to carry the can for a rate cut for others, in some cases severely impacting everything from cash flow through to investment.
We are also fighting against provisions in the Local Government Finance Bill that would allow tax authorities to ignore significant errors in valuations - even up to 15% - denying businesses access to justice when it comes to government agencies' own mistakes.
The consequences of the revaluation are also stark in Scotland and Wales, where rates policies closely shadow those in England. My recent visit to Aberdeen and Grampian Chamber - where members are set to start paying rates based on sky-high valuations made just before the crucial oil and gas sector went into a severe downturn - demonstrated yet again that this sledgehammer of a property tax isn't fit for purpose.
Ministers can, and should, step in to soften the blow - and we have made a number of proposals for ways to do this. When we meet the Business Secretary this week I will be raising this issue yet again to demand action, just as we did with the Chancellor and with Chamber members in a meeting with the Financial Secretary to the Treasury in recent days.
While many Chamber business communities will be benefiting from lower rates in the coming months - a cause for celebration, to be sure - many others, both urban and rural, and across a wide range of geographies, will be seeing tax bills rise. We will continue to work hard up to the Chancellor's Budget on 8th March to demand action, as lowering the up-front cost of doing business is crucial to investment and confidence in the months ahead.