BUSINESS RATE REVALUATION IN WALES

13 July 2018

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On Thursday 11th July 2018 Mark Drakeford, Cabinet Secretary for Finance, announced that the next business rate revaluation in Wales will take place one year earlier in 2021, in line with the next revaluation in England.

Surprisingly, the announcement did not follow England in committing to regular 3 yearly revaluations thereafter, which should more closely align the tax base with general economic conditions.

The deferral of this decision is aligned with a wide ranging review of the system of business rates in Wales, including considering different approaches to property valuation and land value tax as alternative ways of raising revenue.

Andrew West, Director of Business Rates at Cooke & Arkwright commented, “The announcement of a revaluation in Wales in 2021 is to be welcomed, although, not surprising. Regular three yearly revaluations thereafter has much to commend it in maintaining a closer connection with general economic conditions. It is hoped that the Welsh Government will confirm the future of local property taxes in Wales as soon as possible in order to give ratepayers the certainty they require.  It is doubtful whether any changes to the existing system will result in the collection of less business rates, which generate £1 billion per year for the funding of local authority services in Wales.

“As Wales now has devolved powers in respect of business rates, it is right and proper for the Welsh Government to consider its options, albeit limited by the requirement to maintain the income produced from business rates.  It is hoped that their conclusions can be made and implemented quickly in order to give the certainty which all stakeholders require, particularly if there are winners and losers in any proposed redistribution of the tax burden.       

“We also await the outcome of the Welsh Government’s consultation on business rate appeal reform which closed in January 2018.  An announcement on the conclusions would be most welcome.”

Cooke & Arkwright have been providing rating valuation advice to The Welsh Rugby Union Limited (“WRU”) and Millennium Stadium plc for many years. They were recently successful in achieving substantial reductions in the assessments of the Millennium Stadium, covering both the 2005 and 2010 rating list. These negotiated reductions yielded savings of c.£3.5m which, crucially, allows the WRU to re-invest in rugby throughout Wales. They advise the WRU across the group portfolio including the National Centre of Excellence in the Vale of Glamorgan. The valuation issues across the WRU portfolio are complex requiring a high level of understanding of the funding and finances of professional sport in Wales. Cooke & Arkwright’s experience and understanding of these issues and application to the rating valuation have yielded these substantial negotiated reductions. The WRU and the Millennium Stadium entrust our work to organisations with the required levels in experience and expertise in dealing with these complex issues. I am glad to say we have this expertise in Wales. I would have no hesitation in recommending ratepayers making use of this Welsh based expertise.

Steve Phillips, Group Finance Director, Welsh Rugby Union Group