Business rates to be reviewed

George Osborne will announce a review into the structure of business rates which will be completed by early 2016, in his Autumn Statement. Experts have warned that the business rates system unfairly punishes high street firms with large properties and unfairly benefits online retailers with small premises. Some experts are calling for business rates on small premises to be scrapped altogether, arguing that of the 1.7m commercial properties on which business rates are paid, about 1m are used by small businesses. However, if such firms were exempted from business rates, it would reduce the Government’s take by only 6%. Simon Tivey, a rating expert at PwC, said: “There are huge numbers of very small properties that are contributing very little to the rates tax pot but no doubt costing significant sums out of the Valuation Office Agency’s £100m budget to administer.” One proposal submitted to the chancellor is for these small locations to be “bundled” rather than individually assessed for ratings.