Member Article

Localising business rates could cost taxpayer £1.3bn

Government plans to localise business rates could cost the taxpayer up to £1.3 billion, according to a national property consultancy.

Lambert Smith Hampton have criticised the government scheme, which would allow local authorities to maintain localised control over an undefined portion of the increase in rates revenues collected from local businesses.

They believe that the proposals are overly complex and probably unworkable, and predict that the lack of regional parity will translate into unpredictability for businesses.

Richard Wackell, national head of Rating at Lambert Smith commented: *Local authorities will likely
view this as an opportunity to bridge any funding gap by increasing local business taxes.

“I would expect top-up of up to 5%. Considering rates raise £26 billion, this equates £1.3 billion extra bill for the taxpayer.”

Many councils have also expressed concerns about the proposals, including local authorities representatives and the London Councils body. UK plc has taken an anti-localisation stance for some time, due to the unpredictable environment it creates for businesses.

Responding to the Secretary of State for Local Government’s dismissal of opponents ’grumbles, Richard added: “He should not be so quick to dismiss his critics there are some serious problems.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .