By Stuart Hicks, Managing Director.
We are in the final countdown to the deadline for submissions to the Government’s consultation paper “Business rates: delivering more frequent revaluations”.
Published jointly by HM Treasury and Department of Communities and Local Government, the consultation paper seeks views on a number of specific questions and alternative approaches that could deliver more frequent revaluations.
The specific options put forward in the consultation paper a “self-assessment alternative” and a “formula alternative” – both need to be fiscally neutral.
The overall tone of the consultation is a pretty negative one with a whole series of consultation questions focused on “the challenges” of delivering more frequent revaluations under the current system.
The option of self-assessment has already been explored in detail in the media and, whilst questions have been posed and are all valid, I have yet to hear a clear and credible solution that has broad support.
The formula alternative seems to resuscitate an approach that was considered in the original 2014 consultations but rejected in the interim findings published at the end of that year. It was hard to see ratepayers accepting the “tough luck” results inherent in a formula approach when the tax rate is very close to 50% for most larger properties.
What the consultation seems to hint at is that, even with technology playing its part, the present system of individual assessments won’t be able to meet revaluations on, for argument’s sake, a three-yearly basis.
Is this a surprise to anyone? Yes, individual property revaluations can be costly to carry out but isn’t the real expense of a revaluation in the appeals process that often follows?
Common sense dictates that if revaluations were more frequent then they would be more relevant and realistic with less likelihood of generating an appeal – music to the VOA’s ears with its current backlog. The savings from a successful assessment that will last for only three years as opposed to five years arguably will also make it a much less worthwhile investment.
The consultation runs until Friday 8 July 2016 if you want to add your voice to the argument.