The Spring Budget – what is means for business rates

In 2023/24 business rates will contribute £30bn to public sector receipts but the 2023 budget was relatively quiet on this subject.

The major win for ratepayers had already been announced several weeks ago, with the announcement that downward phasing of reductions in liability from 1 April 2023 was to be scrapped. This means that many ratepayers in sectors such as retail, hospitality and aviation will see the immediate benefit of reductions in rateable value following the 2023 revaluation. Announcements today include:

Business rates avoidance & evasion consultation – recognising concerns raised by stakeholders during the Business Rates Review, the government said that it will ensure that revenue is protected by consulting on measures to combat business rates avoidance and evasion.

Business rates retention – the government said that it intends to expand the local retention of business rates to more areas in the next Parliament and will work closely with interested councils to achieve this.

Investment Zones – will have access to a single 5 year tax offer matching that in Freeports, consisting of enhanced rates of Capital Allowance, Structures and Buildings Allowance, and relief from Stamp Duty Land Tax, Business Rates and Employer National Insurance Contributions.

Business rates review – the Government said that it is publishing a summary of responses to the Business Rates Review technical consultation, which closed in February 2022 and that it will set out further detail on how reform will be delivered in response to stakeholder feedback.

Transparency and disclosure – the government said that it is publishing a consultation on the Valuation Office Agency’s “Business Rates: Transparency and Disclosure” consultation publication providing ratepayers with more information on rating valuations. The consultation will seek to gather further views and understand any concerns on how this might work in practice for ratepayers, while balancing the need to protect data and confidentiality.

Digitalising business rates – the government is publishing the summary of responses to its consultation and impact assessment on the design of the “Digitalising Business Rates” (DBR) programme. This document will outline the government’s response to the feedback received which includes a reduction in scope, new legislation to deliver DBR, and an integrated system for ratepayers to interact with central government.