Rates cut aids small firms

breaking news
breaking news

A rates cut, announced by Chancellor George Osborne in the Autumn Statement, has been rubber stamped by councillors in Amber Valley.

In December, Mr Osborne announced a £1,000 discount on business rates to help small shopkeepers and pubs as part of his Autumn Statement. Small businesses with properties worth up to £50,000 are entitled to the discount.

The “retail relief” will be awarded by the council who will be fully reimbursed by the Government. The total value of the relief awarded is expected to be in the region of £600,000 across the borough with approximately 650 businesses qualifying for all or part of the discount.

At a meeting of Amber Valley Borough Council on Monday, March 3 councillors welcomed the scheme and formally adopted it in the borough.

Tory councillor Liz Bowley told the meeting: “It should give much needed help, particularly to small businesses.”

Labour councillor Paul Smith said: “We are still struggling, you only have to go round town centres to see shops and pubs struggling as a result of what people are spending.”

The rate relief will be awarded for the 2014/2015 and 2015/2016 financial years only.

A wide variety of business will qualify and Amber Valley Borough Council will have power to determine whether particular properties are broadly similar in nature to a list suggested by the Government.

To qualify for the relief the business should be wholly or mainly being used as a shop, restaurant, cafe or drinking establishment.

Everything from petrol stations to sandwich shops, travel agents, dry cleaners and art galleries are among the firms which will be eligible.

However, financial services such as banks and building societies, estate agents, letting agents, employment agencies, medical services, solicitors, accountants and insurance agents are among those who will not qualify.

When George Osborne announced the scheme at the end of last year the Institute for Fiscal Studies warned that its short term nature could “create instability” for firms if they are not matched by fundamental reforms.

And this week the Business, Innovation and Skills Committee said the current system of business rates is not fit for purpose and needs to be fundamentally reformed as part of a new report.

The committee called for a wholesale review to examine whether retail taxes should be based on sales rather than the rateable value of a property.