Business Rates Revaluation Postponed until 2022
18th May, 2020The Communities Secretary Rt Honourable Robert Jenrick MP has announced that a revaluation of Business Rates will no longer take place in 2021 to help reduce uncertainty for firms affected by the impacts of Coronavirus. He said:
“We have listened to businesses and their concerns about the timing of the 2021 Business Rates revaluation and have acted to end that uncertainty by postponing the change.”
On the face of it this seems a positive step by the Government but I cannot but help recall the words of Professor Graham Zellick CBE QC just after he retired from his role as President of the Valuation Tribunal for England when he said “The rating system is bonkers”. His words brought back a distant echo of the Late Lord Denning when he uttered that in his opinion “The Law is an ass”.
Quite simply I do not see this statement by Robert Jenrick as positive but possibly bonkers and just maybe a little asinine. We are in the midst of a crisis of which we have never seen the like and rather than defer the revaluation by one year the Government should have taken the step of confirming that they were accelerating the fundamental overhaul of the whole business rates system. It is almost certain that the country will emerge from the Coronavirus crisis in an economic recession which is probably going to be global in scale and the existing business rates regime should be scrapped and replaced with one which reduces the overall burden on businesses and is simple to follow and easy to appeal. The Government amended the system a few years ago to introduce “Check, Challenge, Appeal” and quite simply that has not worked.
What this deferral appears to do is kick the can down the road for a little longer. It seems inequitable that businesses should be rated on assessments based on the 2019 economy albeit 12 months further on from April 2022. The Government at the very least should advise businesses that the revaluation (antecedent) date will be April 2021 when we will be able to gauge some of the fallout from the Coronavirus chaos.
Let us be clear, Business Rates is about raising money, it is a tax and the principles of a good tax should be:
My advice to Rt Honourable Robert Jenrick is be bold, scrap the existing system and engage with businesses to agree a fairer method of taxing them.