Plea to cap Budget increase on business rates

The region’s commercial agents believe the 5.6 per cent increase would have a detrimental effect on rental levels and new development. The comments follow calls by the British Chambers of Commerce for George Osborne to cancel the move.

Terry Goodall, of Dunlop Heywood in Leeds, said economic growth would be stunted unless rates were capped at about two per cent. He added: “The proposed 5.6 per cent increase that was produced by an earlier Retail Price Index ‘spike’ is clearly well above the present inflation rate and so could present a real problem to many business and organisations already struggling across Yorkshire and indeed nationally.”

Jeremy Wilson, of Knight Frank in Sheffield, said: “It could have a knock-on effect on rental levels as businesses will be looking at ways to reduce property occupation costs to offset the increase in business rates.”

He added: “We’re used to and we expect an annual rise in business rates, but this year they are higher than ever so, rather than scrapping it, we’d like to see the rise capped at a more reasonable level.”

David Cullen, of Lambert Smith Hampton in Leeds, said: “The shortage of good new supply to the market, in the absence of any incentive for developers to borrow and build, is storing up shortages of grade A stock which will hinder economic recovery over the next 18 months.”

Philip Clarkson, of Storeys Edward Symmons in Leeds, said: “The Government has (already) introduced a business rates deferral scheme, in effect enabling businesses to spread payment of some of the increase over the next three years. However, this simply puts off the evil day and is only likely to be of benefit to larger businesses, with smaller businesses unlikely to take up the scheme.”

Paul Davinson, of Jones Lang LaSalle in Leeds, added: “These changes next month are likely to focus the minds of many affected by business rates and the need to consider the accuracy of rating assessments and maximising any relief provisions available.”