Large UK firms back fight against tax on empty business premises

Oct 29 2008 by Tony McDonough, Liverpool Daily Post

SOME of the UK’s biggest companies are now joining the campaign to persuade the Government to reverse its decision to start taxing empty business properties.

Tesco, Nokia, BA and McDonald's have joined the British Property Federation’s fight against empty rates with an open letter to Prime Minister Gordon Brown.

B&Q, British Airways, Next and Legal & General have also joined property heavyweights like Brixton, Canary Wharf and Land Securities to get business rate relief on empty buildings reapplied immediately.

British Property Federation chief executive Liz Peace said: “It’s like making the unemployed pay income tax. Taxing hardship and business failure is a ludicrous way to help people through the hard times. Brown must act now to undo this mess.”

Rate relief was scrapped this April in a bid to raise £1.3bn. Now some property experts believe the figure could rise to £2bn due to so many firms having vacant space.

And, as recession sweeps Britain, firms laying people off as they fight to survive will find themselves hit for tax on the empty space. Dubbed the “bombsite Britain” tax over the way it has caused landlords to demolish buildings rather than go bust paying rates, the BPF – the trade body for property – has led a year-long campaign backed by dozens of MPs.

Support for a Commons motion against the tax, placed by Halifax MP Linda Riordan, has doubled in the last week to over 70 MPs.

Ms Riordan said: “Far from being an issue that will just affect jobs and regeneration in Halifax, empty rates will hurt all areas of the country, irrespective of what industry or political alignment they have.”

Shadow business minister Alan Duncan has called the tax ‘immoral’, adding: “Taxing something that generates no revenue does enormous damage.

“Removing the tax relief for empty property rates is bringing to a grinding halt any kind of activity for preparing business premises or developing wrecked premises for future use.

“It is taking money from people who have not got it to the point hey have to take the roof off or demolish what they have just built.”

tonymcdonough