The UK Treasury has launched its largest review of business rates in the UK in ‘a generation’, a move that will affect 1.8m properties in England which currently pay the tax.
The review will examine the current structure of business rates, and ‘paves the way for changes’ on the system, which has been in place since 1988, the Treasury said.
The outcome of the review is set to be due in time for the Budget in 2016, and was first announced in December’s Autumn Statement.
Chief Secretary to the Treasury Danny Alexander said: “The government has taken measures to help businesses by capping rates and introducing reliefs for smaller businesses. But now the time has come for a radical review of this important tax. We want to ensure the business rates system is fair, efficient and effective.”
The British Retail Consortium said it welcomed this ambitious review, and referred to the current system as one which “acts as a major drag on our economy while punishing our local high street”.
Helen Dickinson, British Retail Consortium director general, said: “To guarantee that this review is a success it is absolutely crucial that the government seeks authoritative and independent analysis as it progresses, with solutions based on the objective consideration of supporting evidence.
“Taking this approach will guarantee that the government’s own assessments are robust and that the necessary sweeping reforms deliver a fairer and sustainable system one that ensures that the tax more closely reflects the wider economic conditions and allows businesses to remain competitive.
“With cross-party political support for a fundamental review of business rates, I’m confident we can bring about badly needed change and, in doing so, secure the investment, jobs and growth that have been held back by the burden of this pernicious tax.
“We look forward to working closely with government and the review process as it progresses.”
Today’s announcement of the review follows the government’s pledge in December 2014 to conduct a review and implement a £1bn package to reduce the cost of business rates in 2015-16, with particular support for the smallest businesses and the high street.