3,650 small firms set to miss out on £55MILLION of Government funding
An early payment of £3.4 billion was made to Councils last week to ensure that grants of up to £25,000 would get to businesses as soon as possible to help negate the economic impact of Covid-19.
The grant funding scheme was designed by reference to the business rates system and Rateable Values with qualifying thresholds aligned to the small business rates relief scheme.
Small business rates relief means that those properties with a Rateable Value of between £12,001 to £15,000 in England have previously seen their bills, before the rates holiday, tapered going down gradually from 100% to 0% subject to any discounts.
For these properties, including those with a Rateable Value below £12,000 that receive a full exemption from business rates, the cash grant has been set at £10,000.
The grant only rises to £25,000 for those properties outside the threshold for small business rates relief, those with a Rateable Value over £15,000.
But small properties with a Rateable Value of exactly £15,000 are at the threshold at which normal business rates would have become payable with the tapering having been completely extinguished. These properties are now being constrained to the lower grant funding despite having had no benefit at all from small business rates relief since the 2017 revaluation came into effect.
Robert Hayton, Head of UK business rates, Altus Group, says: “This is an anomaly and obvious unfairness in the design of the grant funding scheme. It is particularly harsh on for those businesses occupying a property with a Rateable Value of exactly £15,000.”
“With thresholds there will always be winners and losers and these are found at the upper end too. In this case, the problem could be substantially alleviated if the Government also tapered the £10,000 and £25,000 grants on Rateable Values between £12,000 to £15,000 to acknowledge the tax contributions made towards local services.”
According to Altus Group there are 3,657 retail, leisure and hospitality premises in England with a Rateable Value of exactly £15,000.