Empty premises on high streets have become one of the defining images of 2018. So, it was not surprising that the Chancellor used his Budget speech to announce business rate relief for independents operating from premises with rateable values (RVs) of £51,000 or less.
The move is likely to assist independent retailers in towns and villages rather than city centres where fewer premises will be rated under £51,000. It is more likely to benefit a butcher in Otley or Morley than a fashion retailer in Leeds city centre.
This would mean that in Briggate and Trinity Leeds, just 12 per cent of retail units (11 out of 89 in both cases) will benefit whereas in Otley the figure rises to 57 per cent (265 out of 467). In Rothwell, the figure is 56 per cent (144 out of 237).
However, this is another example of the Chancellor tinkering with the system rather than undertaking a wholesale reform of business rates.
It is closing the stable door after the horse has bolted because so many high street problems have been exacerbated by the delay in revaluing high street shops, which should have been done in 2015 rather than 2017.
The Government delayed implementing the 2015 Business Rates Revaluation, ignoring calls from business rates experts at the time who argued this would delay much-needed help, particularly required by businesses in the North.
The Government’s excuse was that it would help small businesses and prevent unexpected rate increases – instead, it just meant that retailers continued paying rates based on levels of value set at the top of the retail market in 2008.
The whole system needs a rethink. It needs to be much quicker in responding to the market so that rates can be adjusted accordingly.
The Government has belatedly recognised this by introducing three-yearly revaluations rather then five (or seven) from 2021. Labour wants to introduce annual reviews, an interesting concept but one that requires a significant amount of investment in resources for the Valuation Office Agency to carry out the task.