Wednesday, June 29, 2011

Releasing the value of business land to locals?

Business rates 'to be localised'

Councils in England will be allowed to keep the business rates they collect rather than paying them into Treasury coffers, under new government plans.

Posted by ontheotherhand @ 07:34 AM (1958 views)
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10 thoughts on “Releasing the value of business land to locals?

  • “More deprived areas will not lose out. From the start, no authority will receive less funding when the new arrangements are introduced than they would have done previously.”

    That can only be delivered by making massive savings in central government currently busying itself redistributing the wealth. DCLG, your card is marked.

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  • Good stuff. At present urban councils have every incentive to convert city-centre offices into flats, and leave offices to the outer ring roads. That’s because new flats ate a lot of council tax revenue whereas offices don’t. This change will even the playing field and help revitalise our town centres.

    (Obviously LVT would be best, but it’s a step in the right direction.)

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  • Good in principle..

    Business rate valuations are not currently pursued very vigorously because there is no incentive to do so, so I can see local councils busily re-valuing to crank up their revenue stream from this source.

    As businesses don’t get a vote, I can also see councils ramping the level of business rates to offset council tax or to allow them to indulge in excessive spending.

    If left unfettered, this policy might prove bad for employment..

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  • ut,

    Good point, I hadn’t noticed the bit about giving councils the power to raise rates. Canary Wharf sits in the deprived (and allegedly rotten) borough of Tower Hamlets. Even a small increase in rates would yield a massive boost to the council’s income. Maybe for London they’ll allocate the money to the GLA instead of to the boroughs.

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  • mark wadsworth says:

    This is the only good idea which The One Man Obesity Epidemic has ever had (nicked from UKIP manifesto).

    As D says, councils have a huge incentive to rezone commercial for residential.

    Cleverer would be to keep the nationalised valuation system in place so that councils don’t just hike Business Rates willy nilly (UT’s point at 3) but instead of councils having to hand over all of it to Whitehall, to allow councils to keep say (half) of what they collect – and more importantly, for this half to be ignored in any further calculations about how much money the council gets from Whitehall – if not, all that happens is a council banks £10 million from Business Rates and gets its grant knocked down by £10m, which achieves nothing.

    I say “half” because this is not as simple as it looks – City of London is 99% commercial but the suburbs are only 1% commercial.

    Related topic – John Healy, Housing Minister under the previous lot, said that councils should be allowed to keep all receipts from social housing, which is another good idea for the same reasons as this.

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  • cat and canary says:

    Clegg says: “Deputy PM Nick Clegg said councils had no financial incentive to boost growth and prosperity in their areas.”… why do they need to have such an incentive??? the council is there to provide a service to the public and businesses. Regional development agencies are supposed to be boosting growth and prosperity.

    … this sounds more like a way of bending to the demands of heads of councils for more cash to maintain their bloated salaries.

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  • c & c

    I hope you don’t work for a regional development agency – I rather suspect they’ll be history before long..

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  • cat and canary says:

    no i dont,…yes many are being closed down. however, there are other government funded bodies, such as the Manufacturing Advisory Service, TSB taking over similar roles.

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  • (nicked from UKIP manifesto).lol

    Better luck next time confused people.

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  • Cat and [email protected]

    Completely agree , the councils leaders don’t care about businesses , just want to build their own little power bases .

    Here in Wokingham the Council evicted the the electrical repair man in the Old Townhall by raising his rent/business rates so high he was forced out and replaced by a coffee shop .

    There is already a big Italian coffeshop in the back of the townhall and another in the old townhall 2 doors along from where the repairman was .

    This is the OLD townhall – not the council offices which are the biggest in Wokingham and more lavish than Hampton Court Palace . Never turn their aircon/heating off over the weekend .

    Combine that with one over the road and another 75 meters down the road towards where Woolworths used to be . Then there are another two 175 yards down by the Wetherspoons pub .

    Almost all the coffee shops are big chains .

    Mom and Pop businesses obviously don’t fit into the councils plans .

    Why should they worry how many people they put out of work by jacking up rents at 30% P/A in a recession ?

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