IN RESPONSE to the significant rate of vacancies on British high streets, the chancellor yesterday also promised a 50 per cent discount on business rates to firms that move into previously unoccupied retail properties.
The reduction will last for 18 months, and only applies to properties that have been vacant for a year or longer.
George Osborne also offered up to a £1,000 reduction in rates for retail properties with a rateable value of less than £50,000
A spokesman for the Federation of Small Businesses welcomed the changes, noting that their members’ biggest concern is the level of business rates.
However, PwC’s Simon Tivey noted the potential for the new business rate rules to cause a churn in small firms constantly moving premises to take advantage, unless the government addresses potential loopholes.
“Unless it's managed properly, unintended consequences are inevitable, with small businesses just moving shops to take advantage of the relief, creating a merry go round of rate relief relocations.”
“Consultation will no doubt be required and local councils will look carefully at how this new relief interacts with charity shop relief of 80 per cent, wary it will lead to a proliferation of charity shops,” he added.
Freelancers’ association PCG was less pleased that some entrepreneurs and businesses would be left out of the new reliefs, suggesting that many energetic start-up businesses that share office premises would be excluded from the changes.