In a relief to businesses, the government has announced freezing of the business rates multiplier for the year 2021-22.
The multiplier, also called poundage, for 2020-21 is 49.9p for small businesses and 51.2p for others. The business rates are calculated by multiplying the rateable value of each property by the applicable poundage figure.
The Spending Review document states that the freeze will “save businesses in England £575 million over the next five years.”
The government added that is also considering options for further COVID-19 related support through business rates reliefs.
“In order to ensure that any decisions best meet the evolving challenges presented by Covid-19, the government will outline plans for 2021-22 reliefs in the New Year,” the document said.
Welcoming the measures, the Association of Convenience Stores (ACS) called on the government to act soon to announce further details of business rate reliefs.
“This is good news in that it reduces the extent to which business rates bills may increase in April 2021, but the businesses that have suffered during the Covid crisis can’t be expected to go back to paying full business rates in the next financial year. The government’s plans for rate relief in 2021-22 are going to be very important and we need to hear effective measures as soon as possible in the new year,” James Lowman, ACS chief executive, said,
Various sectors including retail currently benefit from a 100 per cent rates holiday for 2020-21 as part of the government response to the COVID-19 pandemic. The government has also delayed the next re-evaluation of business rates from 2022 to 2023, which will be based on the property market on 1 April 2021 to reflect the impacts of the pandemic on the commercial rental market.
