Small firms' fears over April business rate changes (From Watford Observer)

Small firms' fears over April business rate changes

9:55am Tuesday 29th March 2011 in Business News

THE Federation of Small Businesses (FSB) is concerned about small firms that have empty properties could pay thousands extra in business rates with changes to the exemption from empty property rates due to come into force in April.

The exemption, introduced in 2009, meant that businesses with an empty property in England with a rateable value below £18,000 did not have to pay business rates.

The Government plans to cut this threshold from £18,000 to £2,600.

As a double hit the Government says it will not re-introduce a 50 per cent relief and small firms will not be able to claim Small Business Rate Relief on the property.

This means that struggling business owners who have had to vacate a property and cannot rent or sell it, will have to pay more in rates than if they were running a company from the property.

The FSB has written to local government minister Bob Neill MP to express its concerns that this move could put some small firms out of business.

If the threshold is going to be cut then the FSB calls for a return to the pre-April 2008 situation of granting 50 per cent relief or, at the very least, allow a business to claim Small Business Rate Relief on their empty property.

FSB Beds Cambs & Herts Regional Chairman Ian Cording said: “The Government has said small businesses have a vital role in driving economic growth and getting the recovery on a firm footing, yet for some businesses this additional tax could tip the balance and force them into insolvency.

“The result of this cut in the threshold without restoring the 50 per cent relief will make small business owners worse off than they were prior the 2009 change and significantly more so than they were in 2009 and 2010.

“We urge the Government to look closely at this matter and, at the very least, allow the business to claim Small Business Rate Relief.”