The jury is out on the current condition of the UK’s economy. While recovery is there, it is significantly unbalanced. Services outpace manufacturing, and there is a marked regional contrast between the fortunes of London and the parts of rest of the country. However, this balance shifts in terms of the likely impact of the forthcoming business rates revaluation.
London retailers and offices, for example, look to be hard hit with big rates increases. Is this bad for the economy? Given that other regions may have more reduced rateable values, can it help rebalance regional disparities in economic growth?
The Beattie Partnership has conducted some initial research following the publication of the draft rating list for the 2017 Business Rates Review.
“The picture is not good for London, as it shows an increase in rateable values across most sectors,” Paul observes. “However, the other interesting thing to note is that categories not described as retail, offices or industrial are having an increase outside London too.”
This includes the hospitality sector – hotels, pubs and wine bars – and the education sector – schools, colleges and universities – which are likely to see increases in their rates across many parts of England.
In the context of growth and recovery, whereas you might think hitting London’s retailers and businesses harder might help rebalance things elsewhere, there is also the question of which business sectors are most negatively affected countrywide.
“Services are facing more of a rates hike than other sectors, such as industrial”, Paul remarks. Whether this can actually help manufacturing growth is another issue. It may be that higher business rates bring growth rates down in some sectors without necessarily having any kind of ripple effect on others.
Whether the new business rates help or hinder businesses, or how they might change the pattern of growth in the UK, remains to be seen, but the early indications are that there will be marked changes in the fortunes of different regions and sectors when it comes to business rates in 2017.
To discover how the new business rates will help or hinder your company, please call The Beattie Partnership on 0161 228 2224.
Alternatively, for more information, please read Business Rates Revaluation: Who Wins and Loses?