London will bear the brunt of Friday’s business rates revaluation as expected, with an average 11% increase in bills across the capital revealed today.
Everywhere else in the country will see bills drop by between 2% and 11% when they kick in on 1 April 2017, before transitional relief and small business rate relief are applied.
But transitional relief for businesses in properties worth more than £100,000 may only see relief – the phasing in of the new bills over several years – kick in after bills have risen to 45% in a year.
Mark Rigby of CVS said: “That is staggering. We have never seen transitional arrangements that effectively expose larger properties to such large business rate increases. The expensive London retail locations they are going to feel massive pain when their new bills arrive on 1 April.
“Most of the business rates experts like CVS felt that there would be some cushioning effect but the Government certainly has knocked the wind out of my sails with what it’s proposing to do.”
Related: Jackie Sadek: Rates proposals a massive incentive for local growth
A spokesman for New West End Company, whose members include those in expensive properties on roads like Bond Street, said: “The options being put forward for transitional relief are extremely disappointing and will be catastrophic for West End businesses which will now have minimal time to adjust to the disproportionate business rate rises of up to 80%.”
It said that transitional relief should see any rate rise capped at 12.5% to ease the impact and called again for compensatory measures including extended Sunday trading hours.
The figures revealed today by the Department for Communities and Local Government show the estimated percentage change in bills by region and sector after Friday’s 2017 business rate revaluation, by region and sector.
They were released in a document launching a consultation on transitional rate relief which revealed the figures which will be used in Friday’s announcement by the Treasury.
To lessen the pain of the rate increases, the government is proposing £3.4bn of transitional rate relief, helping more than 140,000 properties in London.
But in the consultation, its preferred option gives less relief to larger properties, worth more than £100,000, of which there are estimated to be 8,800 hit in the first year, compared to 86,900 medium properties and 500,000 small properties.
John Webber, at Colliers International, said: “It’s a car crash for central London”.
He also pointed out £100,000 properties expecting huge downward bills would only see 4% of that in the first year. “It is going to be a long time before you see that 50% reduction.”
Meanwhile resaleable value in England has gone up by 9.1% since the 2010 list, as revealed by a Valuations Office Agency document also released today.
The revaluation was meant to take place in 2015 but was delayed by former chancellor George Osborne.
