CLA sets out action plan for Ministers to avert rates crisis in rural areas

The countryside are facing a hike in their tax bills as a result of a 'flawed' rates system
The countryside are facing a hike in their tax bills as a result of a 'flawed' rates system

Rural organisation the CLA has set out an action plan for ministers to avert the 'impending business rates crisis'.

The organisation says businesses across the countryside are facing a hike in their tax bills as a result of a 'flawed' rates system that is in 'urgent need of review.'

The Country Land and Business Association (CLA), which represents thousands of rural businesses, has set out an action plan for Treasury Ministers.

Recently, the Farmers Union of Wales has been critical of the new business rates, saying they will 'cripple' rural businesses.

And the Countryside Alliance has called for the Valuation Office Agency (VOA) 'to go back to drawing board' over 'punitive' rate rises that risk damaging rural businesses.

The revaluation of business rates takes effect on 1 April 2017, with them being set by the Valuation Office Agency.

Revaluations usually take place every five years, although it has been seven years since the last revaluation because of a pre-election decision by Ministers to delay the 2015 revaluation by two years.

CLA President Ross Murray said rural businesses are suffering because of a
CLA President Ross Murray said rural businesses are suffering because of a 'clumsy and unfair' rates system

'Clumsy and unfair'

CLA President Ross Murray said rural businesses are suffering because of a 'clumsy and unfair' rates system.

He said: “From this April, thousands of businesses will see dramatic increases in their rates bill, a problem exacerbated by the political decision to delay revaluation by two years.

“Ministers appear to have a tin ear to this problem and it is not good enough. That is why we are setting out an action plan that Ministers could adopt as soon as this Budget on 8 March going some way to defuse a looming rural economic crisis.”

The CLA said some of the businesses worst affected by the 2017 revaluation are those whose rateable value has moved from below the 100% rateable relief threshold, to a rateable value above the new threshold.

A spokesperson for the CLA said: “This is a dramatic change in business costs that could threaten their viability. To prevent this, businesses that were exempt under the 2016 Small Business Rate Relief should remain exempt under the 2017 scheme even if their new value has taken them over the threshold.”

'Arbitrary discrimination'

The rural organisation said ministers should also remove the ban on businesses with multiple properties qualifying for Small Business Rates Relief.

The spokesperson continued: “Ministers can end the arbitrary discrimination felt by many small rural businesses that are excluded from qualification for 100% rate relief simply because their business includes more than one property.”

The CLA said the Government should remove the requirement to pay for appeals for worst affected.

“Ministers should remove the requirement to pay for an appeal from equine businesses, livestock markets, self catering accommodation and any other business whose rates rise is a result of a ‘scheme” valuation rather than where the Valuation Office Agency has undertaken an individual valuation.”

The organisation wants to remove rates liability for empty buildings in rural areas – where properties are unoccupied the property owner is required to pay the rates bill.

The spokesperson continued: “The grace period is short - only three months for commercial buildings and six months for industrial.

“This significant cost, at a time when the property is creating no revenue, severely harms the ability to make necessary investments. Grace periods in rural areas should be extended to a minimum of two years to reflect the slower uptake of new property in rural areas.”