Legislation

Business Rates appeals jump

The VOA in the UK received more than 1,000 new Business Rates appeals per day in the last six months, according to Colliers.

Colliers warned that “the glacial pace” of dealing with appeals was putting many companies at risk of closure.

The increase was attributed to an increasing number of companies claiming a Material Change of Circumstance as a result of the impact of Covid-19 on their businesses.

The VOA's monthly figures showed that in England, in the three months to 30 September around 38,960 new checks (the first stage of the process) were registered. Together with the 144,900 registered in the previous three months, this meant 183,860 checks have been registered in the six months since Lockdown began.

This was significantly more than the three-year figure announced in the period between 1 April 2017 and 31s March 2020, when a total of 158,930 Checks were registered. The total number of Checks registered was now 342,760.

John Webber, head of business rates, Colliers International, said: “Covid-19 has led to the biggest Material Change of Circumstance the country has seen in rating history and the system has been around for over 400 years. You could say we are on a wartime footing - and at the moment there is no end in sight.

“Businesses are claiming MCC either as a result of the impact of the initial Lockdown and/or on the impact to businesses as they have tried to re-open and then experienced further lockdowns. With social distancing and consumer and worker fears about returning to the shops or offices to work, few businesses in the country are operating on pre-Covid levels. There is no doubt that their circumstances have changed materially. Footfall has reduced massively, and many offices, shops and restaurants remain closed or on reduced capacity – these are all valid reasons to reduce the rating assessments.”

Webber believed in advocating a radical approach to deal with the crisis. He said: “We believe most of the MCC appeals will succeed  - Covid 19 has brought about an unprecedented disruption. The trouble is the time lag between a business paying its rates bill now and receiving rebated funds back from the VOA on a successful appeal. This could take a year – and many businesses may simply not be around then.

“We therefore recommend the VOA gives a rates discount now and cuts out the middleman – so that businesses pay fair bills they can afford and ultimately would be paying anyway once the appeal rebate is taken into account. This will be essential if businesses are to plan ahead and hopefully work through this crisis.

“The government and VOA must act now to ease the pain or suffer consequences of continued business closures and job losses. The glacial pace of the normal routine of dealing with appeals has to be set aside or business ratepayers will feel like the Titanic hitting the iceberg while the VOA orchestra is still playing ‘Nearer my God to thee!”