The industry has criticised the government for again delaying its final report on a fundamental review into business rates until the autumn this year, with many taking the view that it is “procrastinating” over the topic.
HM Treasury said that it expects “more clarity on the long-term state of the economy and the public finances” by the autumn.
The review was previously announced by chancellor Rishi Sunak at last year’s budget.
A call for evidence was published in July last year, seeking views on key issues including reforming the rates multiplier and alternative ways of taxing non-residential property.
The government is currently “considering” the responses. An interim report, which will include a summary of those responses, will be published on 23 March.
So far the news has prompted anger in the property industry in the face of yet another delay.
John Webber, head of business rates at Colliers, warned that “procrastinating over this now is only going to mean more job losses across the sector – long before the autumn arrives”.
Webber said: “The government has delayed its announcement four times in the last year. We were supposed to hear in the autumn, then in the new year, then in the budget and now it’s the autumn again.”
He added: “High business rates is one of the key factors that has helped decimate our high streets and the current system is skewed against the retail and hospitality sectors.
“We urgently need to rebalance this 50% tax by rebasing the multiplier to 30p in the £1 – for a start – and we need more frequent revaluations so that we don’t see rates tied to totally out-of-sync rental values.”
Jerry Schurder, head of business rates at Gerald Eve, said: “The business rates system is in desperate need of fundamental reform, and this review was the chancellor’s opportunity to grasp the nettle. Instead, like so many of his predecessors with a litany of previous reviews, he has decided that it is easier to delay than actually grapple with the issue.”
Schurder added: “It is about the long-term structure of the system, so to claim that the additional time will give greater clarity is a feeble excuse, and exposes the Treasury’s lack of ideas on how to address the issues the report will undoubtedly highlight.
“The only possible upside to this delay will be the announcement of an ‘oven-ready’ solution in the autumn that genuinely embraces fundamental reform for the system. At the very least that means reducing bills for all and undertaking revaluations far more frequently.”
Elsewhere Robert Hayton, UK president of property tax at the real estate adviser Altus Group, observed it is “unclear whether the chancellor remains committed to or now has the financial headroom to reduce the overall rates burden”.
The news comes after Next’s chief executive Lord Simon Wolfson yesterday called for business rates in high street stores to be cut by 35% along with a 50% increase for online fulfilment centres, in an interview with the BBC.
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