By Stuart Hicks, Director
With all the Party Manifestos now published with two weeks to go to polling day it was heartening to see business rates considered important enough to warrant policy pledges from all the main players.
Here is a round-up of what the main parties in England are promising to do about the perennial issue of business rates ahead of the General Election on 12 December.
In its manifesto, the Conservative Party promises to reduce business rates via a fundamental review of the current system. This broadly lines up with recommendations made in the Select Treasury Committee’s published last month. Not really headline-grabbing but at least they dropped the fiscally neutral rule that has stymied any real progress on the reform front as far as campaigners are concerned.
The Labour Party manifesto promises to review the option of a land value tax on landlords rather than tenants. This appeared in the ‘Land for the Many’ report commissioned by the Labour Party as part of its policy development. That report stated, whilst taxing land is one of the most efficient ways of raising taxes, a tax on commercial property calculated on rental values should be levied against the property owners rather occupying businesses.
Liberal Democrat Party
The Liberal Democrats are pledging to replace business rates in England with a Commercial Landowner Levy based on the land value of commercial sites rather than the entire capital value. Like Labour, they want to see the burden move from tenants to landowners.
Likewise, the Green Party also wants to replace business rates with a Land Value Tax, moving taxation from land users to landowners. They go one step further by also planning to legislate to prevent landowners passing these tax costs back to renters and tenants. Any changes would be phased in over 10 years with various reliefs along the way.
The Brexit Party
With current polls predicting no seats for The Brexit Party come December 12, I’m not sure how much relevance we should place on the party’s “Contract with the People”. However, for balance, they state they want to replace business rates with a simpler system to help small High Street retailers and leisure operators outside the M25. Any reductions would be funded by an online sales tax.
Overall, three out of the five main parties vying for your vote are proposing a land rather than property based tax; the Conservatives are backing another review and Nigel Farage is sticking with a rather vague “simpler tax” system which a GCSE business studies’ student could propose and only expect to get a Grade C for effort.
I don’t think business rates will be a defining subject that sways any voting behaviour but at least it has made it into the Manifestos!