Businesses are being totally let down by the new Business Rates Appeals System which is clearly not working, according to rating experts at Colliers International, the global commercial real estate agency and consultancy.
In answer to a FOI Request made by Colliers International to the Government’s Valuation Office Agency (VOA) concerning “Find My Business Rates” and the “Check Challenge Appeal” system, the VOA revealed that 89% of the 847 respondents were dissatisfied or very dissatisfied (17% and 72% respectively) with the new system and only 2.6% were very satisfied.
The system, which came into force on 1 April requires ratepayers to check the information held on the property by the VOA as the first step in the process. Multiple properties held in a portfolio must each be claimed separately and the identity of the ratepayer must be proven with supporting documentation.
Of the 118 different comments from ratepayers or respondents on how the system could be improved, there were calls for greater simplicity and clarity, information on previous valuations, the search system to work properly, speed, guidance notes and complaints about parts of the website missing or not working. One respondent wrote; “Please can you re-instate the Advanced mode asap or even better re-introduce the full Agent mode, which was excellent. ”
The new rating appeals system also fails to provide provision for an agent to submit appeals on behalf of the property owners – adding to the confusion.
The new system was introduced on the day the largest changes to business rates in a generation were published in April 2017. This included significant rate increases across London and the South East alongside a downside transitional scheme for the rest of the UK that offered little respite to rate payers in the depressed areas. Now the ability to appeal against the new rateable values seems to have become a further issue.
John Webber, Head of Rating, Colliers International said, ” Reading through the responses it is obvious that businesses are confused and frustrated by this new system, which is clearly restricting business owners’ rights to appeal . The Government ignored the advice of rating experts when it introduced Check Challenge Appeal which we said was unworkable at the time, and despite our criticisms, rolled on ahead regardless.”
He continued, “With over 300,000 outstanding appeals still in the system, it is as if ratepayers are being penalised for exercising their right to question their business rates by making it more difficult and expensive. At the heart of the problem is a Valuation Office Agency that is under-resourced and shrinking with lay-offs and the closures of regional offices becoming the norm.”
Colliers has joined with up with other private sector members of the Rating Surveyors’ Association to encourage businesses to lobby MPs about the perceived failings of the new business rates appeals and have provided them with a template letter expressing concerns with a system which is “unduly onerous and burdensome.” It also raises concerns over the VOA’s portal to lodge challenges, arguing it is “not fit for purpose.” MP’s are now responding to these letters and beginning to make representations to ministers.
As Webber comments further, “The lack of planning, insignificant time to trial the system before it went live and apparent lack of desire by the government to engage with agents and their software providers has resulted in a system close to collapse. With the 2017 rating revaluation producing some of the largest increases in liability in a generation, it appears this government has proved again that it neither understands the pressures facing businesses or has a willingness to act on calls to change. ”
Colliers Manifesto for Business Rates Reform includes:
1. More frequent revaluations, three-yearly, at least, by 2022;
2. Increase funding for VOA in order to deal with existing appeals’ backlog;
3. Release VOA from pressure exerted by local councils and HM Treasury;
4. Introduce a register of appeals professionals – removing the ‘cowboy’ element;
5. Root and branch reform of current business rates exemptions and reliefs.