Missed opportunity to solve rate relief problem

Nov 26 2008 by Tony McDonough, Liverpool Daily Post

THE Government has been branded “out of touch with reality” for not using the Pre-Budget report to reverse its decision to abolish rate relief on empty properties.

The new rules came into force on April 1 this year and there have already been reports of some commercial property owners demolishing perfectly good buildings just to avoid the levy.

During the past few months, the commercial property sector has been pushing Chancellor Alistair Darling to reinstate the relief and hoped this might happen in the Pre-Budget statement.

However, Mr Darling’s only concession was a temporary increase in the threshold for empty property relief, with empty commercial properties with a rateable value below £15,000 exempt from business rates for 2009/10.

Mark Rawstron, director of Capital Markets Group at GVA Grimley, said: “This is a huge missed opportunity.

“There is a growing body of hard evidence from both the public and the private sectors that the abolition of rates relief on empty properties is having exactly the opposite consequences intended by those who brought the bill in – if only they had spoken to people who actually know something about this area.

“The direct consequences are reduced availability of cheap flexible space, demolished buildings, stalled regeneration, increased public subsidy and most outrageous of all, insolvency of businesses purely because they have vacant space.”