Chancellor Philip Hammond used the Spring Statement to confirm the next business rates revaluation will take place in 2021, a year earlier than planned.
The move follows Hammond’s announcement in Autumn Budget 2017 that business rates revaluation would run on a three-year cycle, rather than revaluations every five years.
Previously pencilled for 2022, the 2021 revaluation will be followed in 2024. More frequent revaluations reflect the rental value of properties more accurately, and can help prevent dramatic increases in business rates bills.
Rateable values for the 2017 cycle were based on the rental values of properties in 2015, reflecting five years of market activity since the previous revaluation in 2010.
UK business owners are set for an £845m hike in business rates in April, and industry groups – speaking for independent music venues to small retail businesses – have demanded greater protection for small business owners across the country.
This week, a collective from the UK’s hospitality sector wrote to the chancellor demanding reform to “soaring business rates” threatening to kill off growing numbers of small restaurant businesses.
Fairer taxation of digital economy
Hammond also hinted towards how the government would level the tax playing field in the digital economy.
He said: “In the autumn, we published a paper on taxing large digital businesses in the global economy and today we follow up with a publication that explores potential solutions.”
The latest paper details plans to tackle VAT fraud by overseas online sellers, as well as further solutions to ensure multinational digital businesses pay a fair share of tax.
Digital payment methods were also acknowledged, and Hammond announced a consultation to gather the requirements of both business owners dependent on digital payments and consumers relying on cash.
The chancellor made an additional pledge in support of small business owners by putting late payments under the spotlight.
He reassured that government would consider ways smaller suppliers could be supported, and claimed the Conservative Party continued to be “the part of small business and the champion of the entrepreneur”.
Welcoming Hammond’s pledge, Mike Cherry, chairman of the Federation of Small Businesses (FSB), said: “The chancellor is absolutely right to commit the government to eliminate the scourge of late payments, which place cruel financial pressure on more than eight out of ten small businesses.
“The poor treatment of smaller suppliers by many bigger companies is both unacceptable and holds back growth and productivity.”
The Spring Statement was also used to allocate the first wave of funding for the government’s £190m Challenge Fund – a fund announced in the Autumn Budget 2017 to deliver full-fibre broadband to homes and businesses across the UK.
Hammond confirmed that the first round would see investment of £95m into 13 regional areas to roll-out superfast connectivity.
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