In his 2021 Autumn Budget, the Chancellor set out a number of key reforms to the business rates system, including a plan to move to three-yearly property revaluations from 2023, on which those rates would be based. A technical consultation was published on 30 November 2021 setting out a number of technical changes in support of these measures.
In its response, ICAEW has welcomed the use of up-to-date property values but is concerned that most of the burden in determining these values will fall on businesses. This is largely due to the introduction of provisions requiring businesses to provide information relating to relevant properties and their activities to the Valuation Office Agency (VOA) on a regular basis, along with an annual requirement to confirm that the data held by the VOA remains correct. ICAEW considers this administrative burden to be significant, given that revaluations will still only take place every three years.
ICAEW has suggested that more use could be made of information already held by other government departments and that a more digitalised system would help to facilitate this.
The consultation also provides details of an improvement relief regime, which would reduce the disincentive businesses may have to carry out property improvements, if those improvements increase the value of the property and therefore their business rates. ICAEW welcomes the principle of the relief but is concerned by its complexity and considers that businesses may struggle to understand what forms of work qualify.
ICAEW also calls for greater transparency in the process of setting rates and for an online system, which would allow businesses to see how their rates are calculated and the valuations on which those rates have been based.
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