New Tax Year for Rates starts
Retailers and hospitality business in London’s iconic West End will be some of the hardest hit as further increases from last April’s revaluation are phased in during 2018/19. Over 1,400 shops, pubs, restaurants and hotels have received average business rates rises of almost £50,000 according to real estate advisor, Altus Group.
The second year ‘cap’ limiting increases in bills is 32% for large properties with a rateable value over £100,000 to which the effects of last September’s 3% Consumer Price Inflation (CPI) is then added, creating a double whammy of tax rises. This comes on top of rises of almost 50% last year.
According to Altus Group, 1,412 large shops, pubs, restaurants and hotels across the capital’s West End will see tax rises of more than the 3% inflation rate with new tax demands totalling an extra £67.99 million for 2018/19 falling due on 1 April 2018.
The detailed analysis of official government data by Altus Group reveals that 1,164 large shops will face average rates rises of £52,381 whilst 45 large hotels, both budget and luxury, will face average rates rises of £53,900.
155 large restaurants in the West End will each see average business rate rises of £24,811 whilst 48 large sized pubs will face average rises of £15,710. Nationally, 242,274 business premises across all sectors in England, saw above inflation rises with London and the South East hit the hardest.
While overall revenue for Councils in England has risen, funding allocated to councils for discretionary relief to help ease the burden of rising rates bills will fall by more than half from £175.15 million in 2017/18 to just £85 million for the forthcoming financial year.
Alex Probyn, president of UK business rates at real estate advisor, Altus Group, had urged the Chancellor ahead of his Spring Statement last month to freeze inflationary rises, but said that the focus must now be for businesses “to check that what they’re being told to pay is indeed accurate and correct.” Councils across England have set aside £1.2 billion for tax rebates back to businesses during 2018/19 for successful appeals.