Ratepayers’ anxious wait nearly over

All classes of business have shown range of movement and some counter-intuitive increases have emerged

25 August 2016

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After a much criticised two-year postponement, the new 2017 rating assessments will finally be available on 30th September 2016. Six months later, on 1st April 2017, the revaluation of business rates will come into effect based on the value of premises at 1st April 2015. Retailers are particularly anxious about the outcome of the revaluation as their sector was hit hard by the delay. They will have their first indication of the new rates after the Valuation Office Agency (VOA) publishes the draft list at the end of September. This will determine the level at which business rates will be set in April when the list becomes live.

Andrew West, Director of Rating at Cooke & Arkwright, attended the Valuation Office Agency (VOA) Welsh Ratepayers’ Forum liaison meeting in July. He comments, “The VOA has assessed almost two million businesses across the country. The retail sector was worst hit from the deferred revaluation date – which should have taken place in 2015 on the usual five yearly basis. Business rates would then have been based on 2013 rental values, during the recession, instead of continuing to be based on higher pre-recession levels of 2008. The resulting imbalance saw business rates overtake rental values in many places, as rents fell. Some properties have since seen a recovery in values so retailers are understandably concerned to find out whether their rates will fall, as they may have done in 2015, or actually be subject to a further unwelcome rise.

“We understand that while all classes of business have shown a range of movement, both up and down, or remaining the same, some counter-intuitive increases have emerged. The VOA is re-examining any hot-spots.

“The impact of taxation on small businesses is going to be a key focus for the Welsh Government’s next term. This is the first full revaluation since devolution of business rates to Wales, and the Welsh Government will now bear the full financial impact of any policy decisions. With a minority government in place, Welsh Ministers have to take a measured approach to build consensus to enable legislation to gain approval. We can also expect formal consultation before any change in Wales takes place around for example, the appeals process, which is being implemented in England effective from 1st April 2017.”

Andrew West is representing the Royal Institution of Chartered Surveyors (RICS) in providing evidence to the Welsh Government’s Economy, Infrastructure and Skills Committee, which examines legislation and holds the Welsh Government to account by scrutinising expenditure, administration and policy matters. He is a member of the RICS National Rating and Local Taxation Policy Panel and the Welsh Ratepayers’ Forum.

Click here for more on the 2017 Revaluation

Cooke & Arkwright have looked after our property assets in South Wales for many years. Their knowledge of the South Wales market coupled with enthusiasm and willingness to go the extra mile has ensured we keep ahead of the market.

James Rodge, Rockspring