Business rates revaluation of 2021 postponed

The government has postponed the revaluation of business rates scheduled for 2021 in light of the COVID-19 pandemic.

“We have listened to businesses and their concerns about the timing of the 2021 business rates revaluation and have acted to end that uncertainty by postponing the change,” Communities Secretary Robert Jenrick said.

“Now is the time for us to continue to focus on supporting businesses affected by the pandemic, including through our unprecedented package of almost £10 billion in business rates relief.”

Chancellor Rishi Sunak has exempted small shops with a rateable value of less than £51,000 from paying business rates this year in his budget statement.

The government has earlier introduced the Non-Domestic Ratings (List) Bill 2019-20 to bring the date of the next revaluation forward from 2022 to 2021.

While the present measure is intended to ensure more certainty during the coronavirus crisis, the government reiterated that it remains committed to frequent rates revaluations. It also added that the fundamental review of business rates system is in the works.

Trade bodies have welcomed the postponement of rates revaluation.

James Lowman, chief executive of the Association of Convenience Stores, said: “Business rates are one of the biggest financial and administrative burdens faced by retailers and due to the current crisis local shops are already under immense pressure and the full extent of the impact of COVID-19 is currently unknown.

“We welcome the decision to postpone the revaluation as this will give local shops more time to recover from the impact of coronavirus and will provide retailers with much-needed certainty of tax liabilities during this unprecedented time.”

Federation of Independent Retailers (NFRN) has renewed the calls for an overhaul of business rates.

“On the face of it, this announcement seems to be good news but, in truth, the business rates system is broken and continues to do enormous damage to the businesses of independent retailers as they try to complete against online retailers who pay much less,” commented Stuart Reddish, national president of NFRN.

“While the decision not to charge business rates this year was extremely welcome, we want – and need – HM Treasury to move quickly with regards to the business rates review announced by the chancellor in the spring budget as soon as Covid is out of the way. That way, retailers will be able to have certainty and a fairer system.”