Prime Minister Gordon Brown isn’t popular in many camps at the moment. And the retail property market is no exception.

In the Prime Minister’s last budget as chancellor in March last year, he announced his changes to the business rates for empty properties. Until today, no business rates were due for the first three months that shops and offices were empty. After that, 50 per cent of the normal rate had to be paid.

But now, although there is still no charge for the first three months, after that full rates must be paid even if a tenant has not been found.

The Government claims the change will boost occupancy rates and, in some cases, benefit retailers because it will reduce rents. They also claim it will encourage regeneration. But they obviously haven’t quite realised how the retail property market works.

Firstly, it will not encourage regeneration. Landlords are getting very jumpy about the lettings market already and two major schemes have been put on the back-burner because their owners can’t guarantee they will be able to let them.

Landlords that have committed to schemes already are also getting wobbly. Retailers just can’t afford to take highly rented space in every new shopping centre and landlords are having to throw money at them to close the deals.

Whether the tax change will boost occupancy rates is, however, more debatable. So far, the property market has argued that empty property is unoccupied because there isn’t a demand at that time and place. Piling on taxes will not conjure up new tenants or drive down rents.

There has been talk of some landlords trying to exploit the tax loophole by taking roofs off or dismantling walls of their properties. The tax will not apply if the property is not fit to be occupied.

Yet there is also talk of some landlords letting their properties at a lower rent just to fill them. These landlords are not speaking out freely, because they don’t want word to get out. But if it means they don’t have to pay tax, it could be worth their while.

If the Government sees properties being let, it will argue the tax change has worked. But there aren’t many landlords willing to let their properties at a lower rent and they are more likely to try and defy the law change. Yet if there are enough landlords caving in and renting out their properties at a lower rent, the Government will claim victory and the tax will never change back.

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