Budget 2017: business rates revaluation

The Chancellor Philip Hammond has announced a few measures aimed to help some firms with the 2017 business rates revaluation.

First, any business coming out of Small Business Rate Relief will benefit from an additional cap.

Hammond said: “No business losing small business rate relief will see their bill increase next year by more than £50 a month, and the subsequent increases will be capped at either the transitional relief cap or £50 a month, whichever is higher.

“Second, recognising the valuable role that local pubs play in our communities, I will provide a £1,000 discount on business rates bills in 2017 for all pubs with a Rateable Value of less than £100,000 – that’s 90% of all pubs.

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“And third, I will provide local authorities with a £300 million fund to deliver discretionary relief to target individual hard cases in their local areas.

“This fund will be allocated to local authorities by formula, and my RHF will set out details in due course.

“Taken together, this is a further £435 million cut in business rates, targeted at those small businesses facing the biggest increases, protecting our pubs, and giving local authorities the resource to respond flexibly to local circumstances.”

However, he was criticised for not going far enough.

Rob Lankey, chief executive of the National Association of Commercial Finance Brokers (NACFB), said: “It was feared that the Government’s decision to finally scratch its seven year itch and revalue business rates would fall like a ton of bricks on many small businesses across the country.

“Today’s comments from Hammond will go some way to calm these fears – notably amongst publicans and growing companies losing small business rate relief.

“For many though, this revaluation will still significantly increase how much they pay on rateable properties, especially those in the South East and London – costs which a good number of businesses will simply not be able to absorb.

“While the Chancellor’s comments have brought a degree of clarity, the prospect of sheer and sudden increases from April for a large number of businesses could dampen growth intentions.

“As we’ve seen on the ground, small business appetite for funding has been steadily increasing, even in the light of Brexit-induced uncertainty – it would be severely damaging if business rates were the straw that broke the camel’s back.

“While increasing the frequency of business rate revaluations will help to soften the blow of such sharp rises in the future, small businesses will applaud greater clarity on how today’s mooted consultations and plans – such as the discretionary relief fund for local councils – will actually play out in the real world.”

Russell Quirk, CEO of eMoov.co.uk, said: “A real shame Mr Hammond hasn’t put his mind to solving backlash around the revaluation of business rates. There is an underlying feeling of angst throughout the population surrounding this uncertainty and he would have done well to use his first Budget as a platform to quell these feelings, but has in effect, chosen to sidestep the issue.”