Less form-filling for small business rate relief

Small business owners need only apply once every five years for the small business rate relief scheme that can give a discount of up to 50 per cent.

The move effectively lightens the regulatory load on small business owners who previously were required to apply every year for the concession.

Margaret Hodge MP, minister for small business, yesterday said the reduced burden, for councils and firms alike, would be welcomed by the 400,000 business users of the scheme.

Under the changes, ratepayers eligible for the relief will be required to apply for rate relief for the financial year 2007/08, and will not need to apply again 2010/11, unless their circumstances change.

“This is a good example of Government listening to business, cutting red tape and providing the best possible conditions for business success in today's global economy,” Ms Hodge said.

But a search of the websites of small business support groups reveals the rate relief scheme, open to premises under £10,000 in value, is being discussed for the wrong reasons.

One such group, The Federation of Small Businesses, is calling on firms to sign a petition in protest against the possibility that business rates could soon be imposed by local councils.

It conceded that although only a “rumour”, the Lyons review of local authority funding could result in recommendations that the UK returns to a "discredited" system of local business taxation.

“Our members have long memories and the remember the dark days of the 1980s when some local authorities hammered businesses with outrageous rises in their rates,” said the Federation’s Roger Culceth.

“The business rates system is far from perfect but having it set at national level ensures that it is a national issue.”

Before 1990 businesses, often placed very closely to each other but across council boundaries, paid very different rates with the result being distorted competition between firms on a solely geographical basis, the FSB said.

Mr Culceth reflected: “To allow local government to go back to the bad old days will threaten future economic growth and employment levels. That is surely not in anyone’s best interests.”

The FSB’s petition against local authority control of business taxation can be downloaded and signed from the group’s website.


7th September 2006

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