Marcus Jones: improving the business rates appeals system
Proposals published today will allow business owners to check and challenge their business rates bills, using a more efficient appeals system.
Business owners will be better able to check and challenge their business rates bills, using a better, more efficient appeals system, under proposals published today (30 October 2015) by Local Government Minister Marcus Jones.
Mr Jones said the move would streamline the process, ending the “decades-long deadlock” from excessive numbers of speculative appeals which has led to unnecessary delays and to some “unscrupulous agents”.
Currently, over 850,000 appeals have been submitted against rating valuations for the 2010 Rating List – around 70% of which result in no change to the rateable value and less than 2% proceed to a tribunal hearing.
The great majority are submitted by agents, many of whom operate on a ‘no win-no fee’ basis, putting in protective or speculative appeals, with no supporting evidence, sometimes for businesses who are unaware this is being done on their behalf.
Local Government Minister Marcus Jones said:
The business rates appeals process has been in a decades-long deadlock, hampered by some unscrupulous agents making speculative appeals – sometimes for businesses unaware this is being done on their behalf.
A key part of our long-term economic plan is to turn this around and streamline the system, which is why we’re proposing a straight-forward 3-stage process so people can check and challenge their valuations and be confident they’ll get a fair deal.
Ensuring a fairer appeals process
Today’s proposed measures will deliver a more efficient appeals system by ensuring that businesses can be confident that their valuations are correct and that they are paying the right amount of business rates.
Cases can be resolved at an earlier stage with quicker refunds, where appropriate, by weeding out early the speculative appeals that clog up the system. This will allow swifter resolution for businesses in need of support and due refunds.
Under the proposed reforms, businesses would go through a 3-stage process:
- check – ensuring the relevant facts are up to date and accurate, with any agreed errors quickly corrected
- challenge – allowing the business to challenge the rateable value on which their business rates bill is based, giving them the opportunity to set out their grounds for challenging, an alternative valuation and to put forward supporting evidence - we expect the great majority of cases to be resolved by this point
- appeal – offering the opportunity to appeal to an independent valuation tribunal
The Valuation Office Agency will develop a modern simple online service which will allow customers to provide information and to track the progress of their check or challenge.
And to help ensure as many cases as possible are settled beforehand and only those cases that genuinely need to be heard go through, a new fee would be charged for anyone looking to lodge an appeal. This would be refundable to anyone whose appeals are successful, and may be in the region of £100 to £300 - in line with fees charged by other tribunals such as tax tribunals.
Further information
The deadline for responses to today’s consultation is 4 January 2016.
Once reforms have been agreed and subject to Parliamentary approval, they will be implemented using the extended enabling powers, contained in the Enterprise Bill.
The Chancellor has set out major plans to devolve new powers from Whitehall to local areas to promote growth and prosperity. By the end of the Parliament, local government will be able to retain 100% of local taxes – including all £26 billion of revenue from business rates – to spend on local government services. This will be a huge boost to local growth, help attract business and create jobs.
The government will also abolish the Uniform Business Rate and give local authorities the power to cut business rates to boost enterprise and economic activity in their areas. Local areas which successfully promote growth and attract businesses will keep all of the benefit from increased business rates revenues. At the same time, the core grant from Whitehall will be phased out, and local government will take on new responsibilities.
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