Business rate appeals pass 400,000 mark

More than 400,000 firms have lodged appeals against their business rates since the start of the pandemic.

The rise in business rates appeals is not unexpected considering the upheavals seen within the UK economy over the last 12 months. However, the majority of the appeals lodged at the first stage will likely have cited a Material Change of Circumstance (MCC) as their main argument for a reduction.

Those appeals have since been put into doubt with the Government announcing that it was to introduce legislation to block reconsiderations based on Covid-19 as an MCC – a cynical move seen by some as a drastic measure to cut hundreds of thousands of legitimate appeals off at the knees.

The latest appeal figures showed that, between 1 April last year and the end of March 2021, 409,430 checks had been lodged by firms, launching the first stage of the appeals process.

This compares to 158,910 checks registered in the previous three years- since the start of the latest list in April 2017 to end of March 2020, demonstrating the business disruption caused by Covid-19.

However, last month the government said it would legislate to rule out coronavirus related MCC appeals for businesses that were ineligible for the waived business rates in the hospitality, retail and leisure sectors.

Instead, HM Treasury says it will be providing a £1.5bn provision to be spread across the country to sectors that have “suffered most economically”. In its statement at the time, the Treasury said: “Allowing business rates appeals on the basis of a ‘material change in circumstances’ could have led to significant amounts of taxpayer support going to businesses who have been able to operate normally throughout the pandemic and disproportionately benefitting particular regions like London.”

The Government is now being accused of moving the goal posts for the 400,000 business which have already lodged the first stage of appeals – often a costly and time-consuming exercise that requires expert guidance. Do not expect this to be the last debate on the issue as the Government works towards introducing the necessary legislation.