Yorkshire firms overpay £539m in rates as delays take their toll
THE two year deferment of business rates revaluation will cost Yorkshire firms a staggering £539m according to research by Bilfinger GVA.
The property consultancy firm calculated that the North will be hit particularly hard with businesses losing an estimated £2.3bn.
Bilfinger GVA calculated the effect that backtracking and pushing the revaluation back to 2017 has had on businesses, with most companies taking a significant hit from the decision.
The results suggest that the retail sector in the North will be a major casualty, accounting to nearly half of the total £2.3bn cost.
Bilfinger GVA’s April Fools’: The rating revaluation that never was review has also outlined that Yorkshire and the Humber will be the third hardest hit region in the UK, topped only by losses in the North West and West Midlands.
The deferment will cost the east of England, South East and South West an additional £640m, however the firm worked out that London businesses will actually benefit by more than £1.5bn.
Rating liabilities are currently valued against the backdrop of the market in April 2008, just before the recession, a point which many sectors have been as yet unable to return to.
Bilfinger said that current rating system has become badly disconnected from the economic landscape, and left business crying out for changes to create a fairer system.
Claire Paraskeva, senior director in Bilfinger GVA’s Business Rates in Leeds, says: “Although it’s clear that there are winners and losers from this decision, with Yorkshire taking the brunt of the bad news, it’s important to remember that the Government has aimed to be as fiscally neutral as possible.
“These changes are due to growing calls across the business community for what it terms a ‘root and branch’ reform of the business rates system.
“By committing to more frequent valuations and scrapping downward transition from 2017 for those Yorkshire businesses that have been hit the hardest, any future government could make huge strides towards redressing the imbalances in the system, and reducing an increasingly disproportionate burden on growth and job-creating enterprise.”
