Business Rates – What is the Story for Leamington?

Business Rates – What is the Story for Leamington?

After long delays, the revaluation of business rates has been announced. The government presented this largely as a ‘good news’ story but businesses up and down the country have been raising concerns, prompting MP’s to urgently seek feedback.

So what’s the real story and what will this mean for businesses in Leamington? …

This is what I have fed back to Chris White MP whose support I am grateful for, and I welcome any further comments you have.

The changes in the town vary between sector and business size, and impact them in different ways.

Reviewing the number, we can see that more shops, pubs and restaurants (292) have seen an increase in rateable value (RV) than a decrease (248) and there were a number that did not change. While, the total decrease in rateable value is greater than the increase, it still means that around 40% of businesses are seeing an increase and this is unwelcome.

In contrast, rates have generally gone up for Warehouses, Workshops and Factories (129 up, 23 down) and down for Offices (56 up, 257 down), so this is why it is difficult to generalise when making judgements about the overall impact.

We absolutely welcome changes to rates relief that will mean the very smallest businesses in the town (rated 15K or below) benefit further.

However due to higher property values, many independent traders and high street businesses in properties with an RV above 15K will see very little change or a potential increase if their RV has risen.

This includes many businesses on Warwick and Regent Street, who in the past year have had to absorb additional costs relating to pensions, National Living Wage and a sharp increase in wholesale prices due to the devaluation of the pound post Brexit.

Also many of these businesses are not in a position to benefit from a strong on-line offer to supplement overhead costs at their premises and some are paying more for business rates than they do rent. They also contribute hugely to our interesting and vibrant local economy whose benefits are felt far beyond the town centre.

Taxing businesses solely on property value no longer reflects the economic realty, which has seen a huge rise in online shopping and growth in online businesses. It also places a disproportionate burden on independent businesses, which are considered to be the lifeblood of our town centre, and struggle to lower overhead costs through economies of scale.

Furthermore, the appeals system is cumbersome, has huge backlogs and is very stressful for business owners, as they are sometimes faced with demands for back-payments that go into the years.

Changes also negatively impact our larger businesses whose costs are also set to rise even further through the introduction of the Apprenticeship Levy, staff costs and because of increasing economic uncertainty.

BID Leamington asks the Government to support short-term measures such as tax relief to mitigate the impacts of these rises. We would also recommend extending the tapered rates relief threshold beyond 15K, as this would benefit a far higher percentage of small businesses in Leamington and similar towns.

In the longer term, BID Leamington supports calls from the FSB and others for the Government to commit to a major review of the Business Rating system to ensure we have a system that best supports business growth in the current environment.

If you would like to find out more about these changes and what support is available please do not hesitate to get in touch by emailing info@bidleamington.com or calling 01926 470 634.

Businesses rated below 15K may need to contact Warwick District Council (WDC) to ensure they receive the rate relief they are entitled to. Alternatively please download this form and return it to WDC: 2017 APPLICATION FOR SMALL BUSINESS RELIE1

To find out your ratable value (RV) please visit: https://www.gov.uk/correct-your-business-rates

Stephanie Kerr
21st February, 2017

Chris White MP Welcomes Feedback

Chris White MP Welcomes Feedback

As news of the rates revaluation spread, businesses around the UK began to voice concerns. BID Leamington received the following letter from our local MP Chris White. 

Dear Stephanie,

As I am sure you are aware, proposals regarding business rates have been under close scrutiny in recent days.

I am writing to seek your views, and your member businesses, not least so I may better represent any concerns you may have.

The Government is raising the threshold for 100% business rate relief to £12,000, with a tapered rate to £15,000.  I am fully supportive of this measure as I recognise the importance of small and medium-sized enterprises and in particular, the independent sector, to Warwick and Leamington.  However, I am keen to understand any issues that may arise from the revaluation process.

I am closely monitoring the Government’s approach to business rates and am happy to raise any concerns that you may have with the relevant Ministers.  I would therefore be grateful if you could share this letter with your members and I would encourage them to write to me with their views.  I can be contacted at chris.white.mp@parliament.uk.

Finally, I would like to reaffirm my commitment to doing all I can to support local businesses in our area.  You are the reason that Warwick and Leamington has seen a 74% fall in unemployment since 2010 and I am always keen to work to strengthen our local economy further.

Yours sincerely,

Chris White MP
Member of Parliament for Warwick & Leamington
House of Commons, London SW1A 0AA
Tel: 020 7219 7201

After consulting a number of businesses we responded and our response can be seen in our blog. Please do not hesitate to contact us or Chris White MP directly with any further concerns.