Added on: 11th March, 2020 by O1
Chancellor of the Exchequer, Rishi Sunak MP, announced today (11th March) that Business Rates for eligible businesses will be cut completely for the next financial year, and commited to a long called for review of the tax later in 2020.
Following persistent lobbying, which has been a priority for Business Improvement Districts, the government has announced the increase of "Retail Relief" to 100%, running until 31st March 2021 meaning tens of thousands of small businesses will pay no rates at all.
Referencing the government's previous commitment to increasing relief to 50%, Rishi Sunak MP said, "Today I can go further, and take the exceptional step, for this coming year, of abolishing (these) business rates altogether."
Mr Sunak also announced the extension of the relief to some other types of business.
"Museums, art galleries, and theatres; caravan parks and gyms; small hotels and B&Bs; sports clubs, night clubs; club houses, guest houses. They would not benefit from today’s measure – but they could be some of the hardest-hit.
"So, for this year, I have decided to extend the 100% retail discount to them as well.
"That means any eligible retail, leisure or hospitality business with a rateable value below £51,000 will, over the next financial year, pay no business rates whatsoever," said the chancellor.
The move saves some businesses up to £25k in a tax holiday worth a combined £1bn.
Ahead of the budget announcement, Orpington 1st joined London BIDs in writing to the chancellor calling for a complete review of all business taxes. Whilst the relief is extremely welcome news for a large proportion of our business community, those businesses occupying premises with a rateable value of £51k and above, will not see any benefit. Also, the relief does not apply to various businesses within the service sector, which form an integral part of town centres. We were pleased to hear the chancellor commit to a review of this unfair and antiquated tax later this year.
The Orpington 1st BID team discussed Business Rates and its impact on town centre businesses with Orpington MP Gareth Bacon at the begnning of the calendar year.
The chancellor also promised a £3,000 cash grant for any firm that is eligible for the small business rates relief, representing a £2bn cash injection direct to 700,000 of ‘our smallest businesses’. We await further details on this.
The BID also represented Orpington's businesses at an All Party Parliamentary Group meeting in 2018 which discussed the need for reform of business rates.
We anticipate that business which have already succesfully applied for the third or 50% Retail Relief will not be required to re-apply for 100% relief, clarification on this is expected in due course.
In summer 2019, it was estimated that up to half of Bromley borough based businesses eligible for Retail Relief were yet to apply. Details on the Retail Relief can be found on the London Borough of Bromley's website HERE.