Non-Domestic Rating (Lists) (No. 2) Bill — House of Commons, 2020-10-20
Topic: Domestic Commerce
Luke Anthony Hall (Conservative, Centre-right): I thank the shadow spokesman, the hon. Member for Croydon North (Steve Reed), and my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds) for their contributions We are now familiar with the two improvements that the Bill makes to the business rates system. It moves the date for implementation of the next revaluation in England and Wales to 1 April 2023, and it moves the latest date by which draft rateable values must be prepared in England and Wales to 31 December preceding the revaluation. Both changes can be found in clause 1. Clause 2 simply sets the extent and name of the legislation In order to understand clause 1, we first need to consider the main primary legislation for business rates, which is the Local Government Finance Act 1988. All of clause 1 is concerned with amendments to the 1988 Act. Part III of that Act concerns business rates, and it currently requires revaluations in England and Wales to take place every five years from 1 April 2017. Therefore, without amendment to the current law, it would require revaluation to take place in England and Wales on 1 April 2022. The Bill changes that date in a straightforward way by amending the 1988 Act to instead provide for the next revaluation in England and Wales to be on 1 April 2023. It does that both for local rating lists and for central rating lists held by my Department and the Welsh Government. Central lists contain large network properties, such as the electricity supply companies We can see the change in the Bill—clause 1(2)(a) adds the words "on 1 April 2023"; clause 1(3)(a) makes the change for England and clause 1(4) does so for Wales. The change to the timing of the draft rating list from no later than the 30 September to 31 December can be seen in equally simple terms in clause 1(2)(b) for local rating lists and clause 1(3)(b) for central rating lists That date is the deadline—the latest date by when draft rateable values must be prepared. The Bill will still allow the Valuation Office Agency to publish rateable values earlier than the end of December. We fully intend to give ratepayers as much notice as possible of their draft rateable values, the new multipliers and any transitional arrangements that might be included. Historically, these have been confirmed at the time of the autumn fiscal event, so ratepayers will continue to have several months to pay their bill My hon. Friend the Member for Ruislip, Northwood and Pinner raised a point about fiscal events and what might happen in different instances. It is worth putting on the record that it is required within law that the multipliers are produced as part of the local government finance settlement, but we are of course cognisant of the fact that a date in February would be too late. I restate our intention to make sure that they are provided earlier than that—in good time—if events transpire as my hon. Friend described Moving the date of the draft rating list also has implications for local government, which has a share in business rates income through the business rates retention scheme. On that point, I assure the Committee that my Department has held discussions with representatives of local government, including the Local Government Association. We intend to make any adjustments as are necessary to the rates retention scheme to ensure that locally retained income is, as far as practicable, unaffected by the revaluation. That will give councils the assurances they need over locally retained rates income. In the revaluation, we will also ensure that local government will have what it needs to issue the new bills in a timely way The hon. Member for Croydon North raised an important point about VOA appeals and was quite right to do so. It is worth saying that the new business rates appeals system introduced in 2017 is operating smoothly and ratepayers have been able to make appeals throughout this difficult period. The large volume of appeals under the previous list system showed why the system was in need of reform, with large numbers of speculative appeals clogging up the system and over 70% of appeals leading to no change. The VOA recently delivered some key improvements to the system, addressing specific concerns from stakeholders, including new features frequently requested by customers and agents to make the system easier to use The hon. Member for Croydon North is right to highlight that there are still some outstanding cases from 2010. The majority of those cases have been held up by litigation pending the outcome of a Supreme Court case concerning the rateability of ATMs. The Supreme Court issued a decision on the matter on 20 May this year, and the outstanding cases are now being settled. The VOA is engaging with stakeholders and has agreed a timetable to deal with these cases, and I will keep it under close review. He is right to raise that.