Neill drops £400m empty rates bombshell on small businesses

Published 14th Dec 2010

Empty rates relief for small properties has been scrapped in a move likely to cost businesses £400m a year.

Vacant properties with a rateable value of less than £18,000 a year had previously been exempt from paying business rates.

But communities minister Bob Neill yesterday announced that the threshold would drop to £2,600 from 1 April, estimating that to continue with the exemption would cost government £400m a year.

The British Property Federation has warned that passing the cost on to the private sector risks jeopardising a private sector led recovery.

Liz Peace, chief executive at the British Property Federation, said: “If the government is pinning its hopes on a private sector led economic recovery then this is a damaging and retrograde step.

“Empty rates is a tax on hardship at the worst possible time. The majority of the properties affected by this announcement will be in areas that are already economically disadvantaged, and so this will be a further blow.”

Yesterday’s announcement came despite heavy criticism of the tax from communities secretary Eric Pickles and business secretary Vince Cable while in opposition.

Pickles was one of 120 Conservatives to sign a petition calling for the previous government to reinstate full empty rates relief in November 2008.

Source: ' Property Week '

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