BRC's Robertson voices concern at new local levy

Retail property experts have warned that legislation due to come into effect this autumn giving local authorities greater control over business rates could make retailers vulnerable to excessive charges.

The British Retail Consortium (BRC) has expressed concerns over the lack of public consultation the Government has embarked on before proceeding with the legislation, which could have critical financial implications for retailers.

The legislation, announced last week by the Prime Minister in his draft legislative programme and due to come into effect this autumn, would make it possible for local authorities to raise revenue directly from businesses.

Industry leaders are concerned that the changes to the law could leave retailers exposed to disproportionate rate raises by local authorities.

BRC director-general Stephen Robertson said: "With retailers facing tough trading conditions, they need fewer burdens placed on them by Government. There's a real danger that the proposals outlined in the draft Queen's Speech will lead to cash-strapped local authorities shoring up their finances by raising additional revenue through business rate supplements."

The BRC has lobbied the Government to introduce safeguards to accompany the proposals, including a mandatory vote before any business rate supplement is proposed, a provision to allow retailers to offset the cost of business improvement district (BID) payments against the business rate supplement, and exemption for smaller businesses based on rateable value.

The proposed legislation comes at a time when many retailers are already frustrated with the Government over the changes to the laws governing empty property rate relief which came into effect in April of this year.

Hartnell Taylor Cook partner Martin Davenport said: "It's a double whammy. This combined with the empty property rates legislation is going to leave a lot of difficulties for larger businesses.

"It's going to give local authorities carte blanche to introduce this to businesses because it's a very easily enforceable way to generate revenue," Davenport continued. "And for smaller businesses I believe the level of exemption should go up in line with inflation as well as the future increases to overall rateable value that the BRC is proposing."

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