Council Tax and Business Rate Rises!

counciltax-tileCouncil Tax: In April we are likely to see the largest council tax rise for a number of years. This is because of the continued squeeze by the UK government on local council grants. However, there  is an admission by the UK government that the money they have been providing for adult social care has just not been enough.  Instead of restoring funding to councils the Conservative government have raised the ‘cap’ of the amount the county council can raise from council tax. All that the Conservatives are doing are just shifting the burden from general taxation onto council taxpayers. Even then the amount of money raised is not going to be enough to plug the gap. When you get your council tax demand you will see that the ESCC tax will rise by 4.99%. Lewes District Council’s tax will go up by around 1.9% and the Police Commissioner for Sussex council tax rise for Sussex is reported to be 3.36%. These are already published percentages.

Cllr Sarah Osborne, Group Leader of the Lib Dems,  at Lewes District Council is calling for the “antiquated” system to be overhauled and says, “This tax on businesses is a fundamentally flawed, regressive tax because it has no link with ability to pay.” Cllr Sarah Osborne adds “The Government are risking killing off our high streets by cutting the amount of tax paid by large retailers such as Amazon at the expense of our small shops, pubs, cafes and restaurants who may be forced out of business.”

graphBusiness Rates: The situation for businesses has a mixture of good news and bad news. For the first time for in 7 years there has been a business rates review. Linked with this, ministers have freed up the valuation ‘ceiling’ which has resulted in extraordinary high increases for some businesses. One pub landlord in the Lewes area recently told me that his business rates are forecasted to go up by 177%!  It seems the ‘winners’ who are getting reductions are warehouse companies like Amazon and the losers are businesses in our towns and villages with ‘bricks and mortar’ style premises. At this week’s upcoming District Council meeting I have tabled a question asking the Conservative leader to write to the government asking him to undertake an urgent review to try and soften the blow on small businesses.  (See below) Hopefully, because of the pressure from all quarters the Chancellor may take special action in his Spring Budget on 8 March 2017.

Cllr Vic Ient’s question to the Lewes District Council – Thurs 23rd Feb 2017:

Excessive business rate increases for local pubs, restaurants and small businesses

Over the past few weeks in the press we have seen a number of national organisations including the CBI, the IOD and the British Chamber of Commerce raising their concern about the rating revaluation which may affect a whole range of businesses including local pubs and restaurants/catering businesses. Whilst I appreciate that the rating revaluation for businesses occurs regularly every five years and that the government regularly uses a tapered form of relief to soften the blow over the five-year period of implementation it seems that this year there is a much bigger step increase in the basic revaluation for these smaller local businesses. In comparison it seems that major international companies like Amazon with large warehouses will have a sizable reduction in their rating revaluation. It seems that the pubs and small restaurants are being penalised because they are on the high street or in a bricks and mortar building in the countryside whereas rating revaluation for industrial estate warehouses have gone down! We can’t believe everything in the press but with the Times and the Guardian talking about increases of 42% for smaller businesses and with the calls from respected institutions that I’ve mentioned above , I believe the Lewes District Council should not ignore the potential problem.

My question is this:

Would the Leader of the Council write to the Secretary of State for Communities and Local Government, as a matter of urgency, asking him to review the levels of onerous tax increases which the smaller businesses are facing due to the business rate review? 

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