Firms are being warned that business rates could go up by as much as 2.6 per cent next year, following the publication of the latest official financial statistics.
A leading expert from property firm CBRE Bristol has warned that businesses will end up paying the price for the decision to use the Retail Price Index to set next year’s business rates.
The Retail Price Index figures recently announced for September saw an increase of 2.6 per cent and the announcement is expected to lead to a corresponding increase in business rates (the business rates increase in April is calculated using the RPI rate for September).
Retailers and business leaders have long called for the Government to change the way it sets the business rates. The business community believes other indicators such as the consumer price index would take the unfairness of the system.
The Government has still not confirmed whether RPI figure will be used but if it is then the result will see the National Non Domestic Rate increase from the current 45.8 pence in England to 47 pence from next year.
Rohan Short, who heads up the rating and taxation in CBRE’s Bristol office, said: “The increase in the business rates is the smallest for several years and is significantly less than the five per cent increase endured by businesses earlier this year.
“However, cashflow for many businesses remains under pressure and any increase in the burden of business rates will be unwelcome.
“Over the past three years, many businesses will have had to bear a total increase in business rates of over 13 per cent. We are advising a large number of businesses on how to either permanently reduce or temporarily mitigate their liability when it comes to the business rates.”
