Since they were introduced in 1988, Uniform Business Rates [UBR], have been reviewed at five yearly intervals. The next review is scheduled for 2015 but the government has announced it will be delayed by two years. Since the rates always go up, you might think this is a kind gesture but some people smell a rat!
The vagaries of the system mean that the actual rateable value [RV] of each property is set two years before it is implemented. So the 2015 rateable value would be determined by the rental values of commercial properties on 1st April 2013. This is where business representative bodies start to feel less than grateful.
The government claims that it is delaying the review to provide two more years of certainty about the amounts businesses will pay in these uncertain times [although UBR will still go up annually by the rate of inflation]. The current rateable values were based on economic circumstances as at April 2008 when rental levels were at their height just before the credit crunch bit. Since then, outside London, many rents have tumbled and, because the recession will almost certainly lead to flat growth in the economy both this year and next, they are unlikely to have recovered by 2013.
Had the scheduled revaluation taken place using 2013 figures there is a strong likelihood that considerable reductions in rateable value would have resulted. This would not automatically have translated into equally reduced bills because the government has the power to reset the Uniform Business Rate at revaluation to ensure that in real terms the the amount of revenue raised does not decline. Nonetheless most tenants outside the Capital would have benefited.
By 2015 when the RVs are set the economy, and rental levels, may have improved significantly. Or maybe not.
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