2021 Autumn Statement – Business Rates

Business Rates

A raft of business rates measures were announced in the 2021 Autumn Statement.  Some changes were short term, others relate to the longer-term direction of the business rates system.

Freezing the Tax Rate

Each year the government is permitted to increase the underlying tax rate for business rates (the UBR) by the preceding September’s CPI figure.  CPI in September 2021 came in at 3.1%.

Under significant pressure from the retail and hospitality sectors, the government has committed not to increase the UBR for the second year in a row.  This effectively provides a 3% reduction in business rate liabilities for 2022/23 across the board, which is welcome news.

Covid Related Rate Relief Extension

Under the ambitious headline of “the biggest single-year cut to business rates in 30 years” the government announced it was tapering out the current expanded Retail Hospitality and Leisure discount scheme (RHL) by offering a further year of relief at a reduced rate. 

2020/21 saw the government provide an unlimited 100% RHL relief for all qualifying ratepayers.  In 2021/22 it effectively granted 75% relief to the same set of ratepayer, subject to a £2m cap on part of the relief.  

For 2022/23 the government has announced that the RHL beneficiaries will receive “at least 50% off their business rates bills” subject to a single cap of £110,000 applicable to all related companies. 

Other measures announced include exempting certain renewable energy equipment from business rates and, with effect from 2023, providing 12 months relief from additional rates resulting from expenditure on improvements.

The government consult on the arrangements for a transitional rate relief scheme for the 2023 revaluation in due course.  They will however extend the existing scheme into 2022/23 for small and medium sized assessments.

Missing from the budget were details of the promised £1.5bn relief scheme for businesses that did not benefit from the Retail Hospitality and Leisure scheme.

Click here to download the Autumn Budget.

If you have any questions or need advice on any business rates matters, please contact Alan Vickery

020 7489 4831 or alan.vickery@dwdllp.com