'Small restaurants and pubs 'to miss out on £55m of Government funding'
According to real estate adviser Altus Group, properties with a rateable value of exactly £15,000 - of which there are over 3,500 in England - will miss out on £55m of Government funding because of how the funding is calculated.
The grant funding scheme was designed by reference to the business rates system and rateable values with the lower qualifying threshold aligned to the small business rates relief scheme.
Altus says that small business rates relief means that those properties with a rateable value of between £12,001 to £15,000 in England have previously seen their bills, before the retail relief, tapered going down gradually from 100% to 0% subject to any discounts. For these properties, including those with a rateable value below £12,000 that receive a full exemption from business rates, the cash grant has been set at £10,000.
However, small properties with a rateable value of exactly £15,000 are at the threshold at which normal business rates become payable with the tapering having been completely extinguished, it says.
These properties are now being constrained to the lower grant funding of £10,000 despite having had no benefit at all from small business rates relief since the 2017 revaluation came into effect.
“This is an anomaly and obvious unfairness in the design of the grant funding scheme. It is particularly harsh on for those businesses occupying a property with a rateable value of exactly £15,000,” says Robert Hayton, head of UK business rates at Altus Group
“With thresholds there will always be winners and losers and these are found at the upper end too. In this case, the problem could be substantially alleviated if the Government also tapered the £10,000 and £25,000 grants on rateable values between £12,000 to £15,000 to acknowledge the tax contributions made towards local services.”
For properties with a rateable value of between £12,001 to £15,000, including those with a rateable value below £12,000 that receive a full exemption from business rates, the cash grant has been set at £10,000.
The grant only rises to £25,000 for those properties outside the threshold for small business rates relief, those with a rateable value over £15,000.
An early payment of £3.4bn has been made by the Government to councils to provide eligible businesses with grants of up to £25,000 in the wake of the Coronavirus crisis.
