7th March 2024 - James Burkitt

In yesterday’s Spring Budget, chancellor Jeremy Hunt announced various measures and in this article we have focused on what this means for business rates:-

Retail, Hospitality & Leisure Relief

As previously announced in the Autumn Statement, eligible retail, hospitality, and leisure businesses will continue to receive a 75% deduction to their business rates liability which is set at a cap of £110,000 per business. There was no confirmation this relief would be extended beyond April 2025.

Uniform Business Rate (UBR)

The UBR or Uniform Business Rate is used to calculate your business rates liability from your Rateable Value.

Although properties below a Rateable Value of £51,000 have had there UBR frozen at 49.9p, those with a higher Rateable Value of above £51,000 will see this rise by 6.7% from 51.2p to 54.6p in the pound, despite the fact the Chancellor announced inflation is forecast to be below 2% in Q2 2024.

Film Studios

A 40% relief will be introduced for eligible film studios in England for 10 years from 1 April 2024 . This will be welcome news for many film studios who have seen substantial increases between the 2017 and 2023 rating revaluations.

Empty Rates Relief

Empty rates mitigation is an evolving topic, which we have previously discussed in our January article Box Shifting. The period for which a property must be occupied to receive a new Empty Rates relief period, has increased from 6 to 13 weeks from 1^st April 2024. In short, this will increase business rates liability for those who have long term empty properties and has been implemented to deter property owners from carrying out empty rates mitigation schemes.

‘General Anti-Avoidance Rule’

The Government have published responses to the July 2023 Business Rates Avoidance and Evasion Consultation which outlines a new ‘General Anti-Avoidance Rule’ which will look to “tackle emerging avoidance schemes as they materialise”, further information will be provided in a separate consultation.

Other measures include improving information sharing between Local Authorities, the Valuation Office Agency and HMRC to combat business rates evasion and improving communications with ratepayers to assist them in choosing the right surveyor. The Valuation Office Agency have already been busy social media campaigning on this topic and have published a new set of agent standards.

Conclusion

Whilst we were not expecting too many new measures, it is disappointing that the main takeaways are an increase in business rates liability for those with long term empty properties along with the announcement of yet another business rates consultation.

The Government are currently tinkering around the edges with regards to business rates and with inflation falling surely a more popular and simpler measure would be to reduce the UBR.