Monday 21 November 2016 12:01 am

Top industry groups hit out at proposed changes to business rates

Billy Bambrough is City A.M.'s deputy news editor.

Billy Bambrough is City A.M.'s deputy news editor.

A group of industry lobby groups has hit out at Treasury proposals to prevent small firms from appealing against business rates up to a certain level.

Research by Daniel Watney LLP and Blackstock Consulting, using official government data, found the changes could cost small firms in England more than £700m over the next five years.

The government is consulting on an overhaul of business rates, which are paid on top of commercial property rents, with changes set to take affect from April next year.

Read more: London boroughs prepare for £9.5bn business rates hike

Under the so-called reasonable professional judgement provision, ratepayers won’t be able to argue against a rates bill if its margin of error was inside 15 per cent.

Eight business groups representing small businesses, pubs, property owners, hotels and retailers, and including the British Property Federation, the British Retail Consortium, the British Beer and Pub Association, and the Federation of Small Businesses have condemned the move, calling it “unjust” and “wildly unfair”.

The groups have called for the government to revert to an earlier system to try to cap the increase that businesses will have next year at 12.5 per cent.

Read more: Ritz boss: "MPs deciding business rates have never had a job"

“We believe this clause simply fails the fairness test and could result in the door being shut on small businesses who want to correct inaccuracies in valuations and reduce their rates bills,” said Martin McTague, policy director at the FSB.

“It is hard to see how these proposals improve our broken business rates appeals system,” said Melanie Leech, chief executive of the British Property Federation.