Enhanced Transparency in Business Rates Valuations
The VOA has published details on how it will improve the disclosure of information regarding business rates valuations.
This move is part of a broader effort to increase transparency and fairness in the business rates system. The changes were outlined in a recent consultation that built on the ‘Business Rates Review: Final Report’.
Access to Underlying Evidence
Under the new measures, ratepayers will have access to an analysis of the evidence used to set their rateable values.
This includes detailed information that was previously only available during the formal Challenge stage of the Check Challenge Appeal process.
This increased transparency is expected to help businesses make more informed decisions about whether to challenge their rating assessments.
Economic and Industry Impact
The enhanced transparency will positively impact businesses, especially those on the high street and in sectors like retail, hospitality, and leisure.
By providing clearer insights into how rateable values are determined, businesses can better understand their tax liabilities and make more strategic investment decisions.
Statistics
- Rateable values are based on the estimated annual rent a property could have been let for on a set valuation date, such as 1 April 2021 for the 2023 rating list.
- The Transitional Relief Scheme will phase in increases to business rates bills over several years, with percentage increases dependent on the rateable value.
- The Supporting Small Business Relief Scheme limits annual increases to £600 for businesses losing Small Business Rate Relief entitlement due to revaluation.
Industry Response
“Greater transparency in business rates valuations will help build trust and ensure fairness in the system. It will enable businesses to make swifter and more informed decisions about their rateable values,”
Simon Ridley, Director at the Valuation Office Agency
This perspective underscores the importance of transparency in maintaining a fair and equitable business rates system.
Progress and Future Developments
- The government has committed to further reforms to support businesses, including introducing permanently lower multipliers for retail, hospitality, and leisure properties from April 2026-27.
- The small business multiplier will be frozen in 2025-26 to protect the smallest properties from inflationary increases.
- Future revaluations will occur every three years to reflect changes in the property market.
Local Implications
The changes will have varying impacts across different regions and sectors. For instance, businesses in Wales will see their rateable values assessed independently by the VOA, with the Welsh Government setting the business rates multiplier and determining national policy.
Local authorities in England will also see adjustments in how business rates are calculated and redistributed following revaluations.
Immediate Effects
The immediate effect of these changes will be a more transparent and potentially more equitable business rates system. Consequently, businesses will be better equipped to understand and challenge their rateable values, which could lead to more accurate and fair assessments.
Broader Significance
These reforms aim to create a fairer, more responsive business rates system, supportive of investment and economic growth.
By addressing concerns about the current system, the government hopes to foster a more vibrant and sustainable business environment.
The Report on the results of the consultation.
