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Where's my £1000 discount? That's the question a lot of licensees have found themselves asking recently

On 02/05/14

The Autumn Statement last December announced a £1,000 discount for retail businesses with a rateable value of £50,000 or below for the next two financial years. In part this was a response to the struggles of the High Street and also aimed to address the growing sense of unfairness about the business rates system.

It was an extremely welcome move, for which both the Chancellor and the Community Pubs Minister Brandon Lewis deserve great credit. The Treasury is paying for it and Mr. Lewis' department, DCLG, are in charge of business rates.

For licensees it will make a difference. A licensee recently wrote to the Prime Minister about the burden of business rates on his business. The letter was copied to the Publican's Morning Advertiser, who connected the gentleman with the BBPA. The pub's rateable value is £26,000 so the bill would have risen from £12,246 per year to £12,679. As it was the annual bill fell to £11,532, a saving of £714 on the previous year. Or rather it would have done if he had received the discount.

And this is where issues start to arise. Although the discount is funded from central Government it is up to the 300+ billing authorities (councils) to implement the reduction. Having experienced a relatively small number of these bodies, it seems that there are wide variations in the way they are dealing with the discount.

The Royal Oak mentioned above is covered by Harrogate Borough Council. To receive the discount businesses need to complete a form and return it to the Council to receive the discount. It doesn't appear that businesses were made aware of this fact when they received their rates bills for the coming year. If this is the case then it appears likely that many pubs entitled to the discount will not receive it. The Royal Inn was only made aware of this when they contacted the BBPA.

Tunbridge Wells so far stands out as best in class. Pubs have reported that their discount was automatically applied to their bills when they were sent out for the year ahead. This clearly reduces the administrative burden on the pub and helps with cash flow from the start of the year.

Other local authorities, including Ashford, also in Kent, have not applied the discount but have assured businesses they will have had an update by the end of May. The London Borough of Haringey on the other hand has no reference to the relief on its website and little indication of when the discount will apply.

Reasons for delays have been cited as IT and procedural difficulties. It is true that some systems were not set up for this type of discount so that may have caused some delays. And it is also the case that councils need to set up a local scheme to administer the discount. But these measures were introduced nearly five months ago so there should be little excuse for pubs and other retail businesses not receiving what they had been offered. If Tunbridge Wells can get the discounts onto bills by March it seems hard to believe that Haringey Council won't even have received permission from their councillors to do so until June at the earliest!

I would plead with all councils to implement this discount at the earliest possible opportunity. It can make a big difference to a small business. And if any business that believes they have not received the discount that they are eligible for please get in touch.

As an aside, the retail relief on its own isn't enough to alleviate the burden of business rates. More needs to be done. And that is why we are grateful to see Government looking more closely at this, including a consultation on 'checking and challenging' rates and a recent discussion paper on the administration of the whole scheme, including revaluations. This is the highest profile that business rates have had for a very long time.


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