Small businesses are imploring the Chancellor of the Exchequer, Philip Hammond, to use the impending Autumn Budget 2017 to put a stop to the chaos of business rates that has become a serious cause for concern for many small firms.
The business rates system has continued to come in for criticism from the UK’s small business community even after the Government re-evaluated the tax in April.
The Federation of Small Businesses (FSB) has called on the Chancellor to consider more regular business rates re-evaluations and put a stop to the controversial so-called ‘staircase tax’ at the upcoming Autumn Budget 2017. The body also recommends future business rate rises should be linked to the consumer price index (CPI) as opposed to the retail price index (RPI).
Small firms which occupy many floors in a commercial property used to receive a single business rates bill, but are now being subjected to separate rates bills per floor occupied if they are connected by a communal staircase.
However, small firms with private staircases are not being charged more, which has led to the calls for a unified system on multiple floor occupancy and an end to the ‘staircase tax’.
Mike Cherry, National Chairman, FSB, said: “Today marks seven months of business rates chaos following April’s bruising revaluation.
“In that time, we’ve had the staircase tax, chronic delays to relief measures, a disastrous new appeals platform and now an RPI-linked increase in bills.
“The business rates regime is nothing short of a living nightmare for millions of small firms.
“The Chancellor must put an end to the staircase tax at the Budget and ensure that each of the emergency reliefs announced at the last Budget are in place by 22nd November.
“Four-in-ten councils are yet to pass on their share of the £300 million business rates hardship fund to struggling small businesses. After seven months, that’s ridiculous.”
The FSB also believes more frequent assessments of business rate valuations would enable small firms to benefit from fluctuations in the UK property market.
The body points to the disproportionate impact of April’s re-evaluation in London, with 16% of rateable properties bearing almost a third (32%) of all UK rates payable. It claims new small business rate relief thresholds for inner and outer London at £20,000 and £15,000 respectively would be in the best interests of growing firms.
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