Business rates revaluation should be scrapped for 2020

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Property consultant Knight Frank’s national head of business rates has called on the government to scrap its proposed business rates revaluation amid the coronavirus crisis.

Currently businesses face  paying rates in 2021 based on  the re-evaluation from 1 April 2019 , just when business will be recovering from the pandemic.

Keith Cooney, national head of business rates service line at Knight Frank, said: “Government has continued to progress with the next business rates revaluation and passed the enabling bill into the House of Lords for a reading next week.

“Consequently, businesses across the country will be faced with uncertainty next year on the impact that this revaluation will have on their business rates. Although the process of the revaluation commenced nearly two years ago, we are clearly now in extraordinary times, with businesses of all sizes trying to stay afloat whilst we endure the current pandemic.

“The daily reassurances from government that it ‘will do whatever it takes’ to see us through this are in fact in stark contrast to continuing with this revaluation.”

Cooney said that in normal times, the rates revaluation is a progressive mechanism which enables government to redistribute the burden of  £29 billion of business rates tax on to the shoulders of those who are more readily capable of paying it.

“This is achieved by looking at the movement in the rental market since the last revaluation and adjusting all properties rating assessments to reflect this change. However, as this is such a major exercise, government set the revaluation date some two years before the new rating list comes into force.

“As such, businesses will have their rates revalued based on April 2019 when COVID-19 did not exist and these charges will be enforced next year when they will be trying to recover from the pandemic.”

Cooney explained that the current rating list came into force in 2017 and was treated as an experiment by government at the time with the imposition of a new untested rating appeals process.

“This was called Check, Challenge Appeal and it could only be accessed through an online portal system set up by HMRC,” he said. “Unfortunately, the system wasn’t fit for purpose and even now, after three years, remains acutely problematic for the majority of ratepayers trying to challenge their assessments. To address these short comings, the most pragmatic and reasonable approach would be to postpone the revaluation and scrap this bill.”


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