Business Rates: reform and appeals – Rapleys Head of Rating reacts

Alan Watson, head of rating at commercial property and planning consultancy Rapleys commented:

“Much of the current noise from the government and the Valuation Office is driven by the number of appeals on the current rating list and the frustration that time and money is squandered over those appeals which don’t actually secure a reduction for businesses. While, undoubtedly, a small portion of this is down to a few bad eggs lodging frivolous appeals, the bigger issue is that it is fundamentally impossible for legitimate advisers and businesses to get information about the make-up of a rating assessment without lodging an appeal.

“Business rates are just a tax and, as tax payers, businesses want to know that what they are paying is fair and accurate. However, the current system has businesses able to see the price-per-square-metre the Valuation Officer has used, but not able to uncover how that figure has been reached without lodging an appeal. Even when information is finally released, often at the last minute and usually after a case is called for a Valuation Tribunal Hearing, the rents used in the calculations are often illogical – at best. For instance, rents have been used for calculations that are miles away from the property under appeal and sometimes not even in the same town.

“One of the Government’s argument’s for the new Check, Challenge, Appeal system is to keep the number of appeals down and to make things more clear and transparent. The Check stage may improve knowledge of the facts, but the Challenge stage puts businesses back to square one, with the crucial rental data still nigh-on impossible to come by.

“In addition, the Valuation Office’s new system will require businesses to register their properties online for assessment and it is still unclear whether advisers will be able to do so on behalf of clients – particularly those who have large and complex portfolios, or are actively disposing of or acquiring sites. There is a real risk of this becoming yet another administrative headache for businesses, where an honest mistake may result in higher bills.

“Of course, April’s revaluation will be a welcome boon to those businesses who will benefit from a rate reduction but the underlying system has short-changed many for far too long. The appeal system is the only way for businesses to ensure their rates are fair and proportional, and, unless there is a significant, meaningful commitment from government to increase transparency and improve the flow of information from the Valuation Office, the system must be protected.”