In October 2024, the government announced its intention to “create a fairer business rates system that protects the high street, supports investment, and is fit for the 21st century”. This was followed, in September 2025, by the publication of an interim report that identified several priority areas for the reform of the business rates system in England. The areas were summarised in an earlier article. 

The government has now published a call for evidence seeking evidence to support some suggested areas for reform. It particularly wants to hear examples and case studies from businesses in the following areas: 

Improvements and investments 

The government wants to understand more about typical investments made by businesses into their properties including:  

• who usually carries out improvements (eg, landlord or tenant); 
• typical types of improvement; 
• life cycles of investment; and 
• how the business rates system affects decisions in this area compared to other factors, such as borrowing and labour costs and regulatory requirements. 

Slab to slice 

Currently, when a property moves from being dealt with under a small business multiplier to a standard multiplier (eg, as a result of a revaluation) the rates applicable to the property are calculated by multiplying the whole rateable value by the standard multiplier. The government is proposing to move to a slice basis, whereby the proportion of the rateable value below the threshold continues to attract the small business multiplier. The government is seeking specific examples of where such cliff edges in the system are proving an impediment to investment.  

Small business rates relief  

In a similar vein, the government is keen to remove steep increases in liabilities that arise when small business rates relief (SBRR) is lost, if this is having an impact on investment. It also wishes to seek views on the tax treatment of short term lets, responding to a concern that SBRR is being used by some second home owners to manage tax liabilities. It is asking whether there is evidence to support this concern and what reform could be introduced to address it. 

Improvement relief  

Respondents to previous consultations (including ICAEW) have called for improvement relief (IR), which provides for a 12-month reduction in business rates following improvement works that raise the rateable value of the property, to be extended to a longer period (eg, three years). To support such a change, the government wants to hear examples of improvements that have not been taken forward because of business rates and other aspects of IR that could be improved to support investment. 

Empty property relief  

The government is trying to balance the usefulness of empty property relief (EPR) to support landlords holding vacant properties against restricting the use of the relief to avoid rates by carrying on limited activities to trigger the reset period. It wants to understand whether the length of relief (three months, or six months for industrial buildings) is still appropriate based on typical lease durations. The government also wants to know to what extent EPR influences a business’ decision to acquire or dispose of empty properties and the main factors that contribute to bringing an empty property into use. 

Receipts and expenditure valuation methodology 

There are three bases on which valuations are carried out on properties for business rates purposes. The receipts and expenditure (R&E) method is typically used where there is insufficient rental information, such as in respect of unique properties like hotels, theme parks, utilities and airports. This can lead to challenges in predicting the outcome of an R&E valuation and making long-term decisions. 

The government is seeking examples of cases where valuation uncertainty impacted the ability to plan or implement investment decisions. It also wants to hear about alternative approaches that could provide greater predictability and stability.