Property rate exemption claims are misleading (From The Northern Echo)

Property rate exemption claims are misleading

12:19pm Wednesday 1st April 2009 in

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CLAIMS that 75 per cent of commercial premises in the North-East qualify for exemption from Empty Property Rates (EPR) were yesterday said to be misleading, after it emerged the figures include public toilets, car parking spaces and ATMs.

The research, released today by the British Property Federation (BPF), suggests that the actual level of exemption in the region could be less than half what had been claimed.

EPR is payable on every empty building and is thought to have been responsible for at least 15million sq ft of buildings being demolished over the past 12 months.

Exemption from EPR was granted in November for properties with a rateable value of less than £15,000.

In a further move to highlight the damage caused by EPR, the BPF today launches a website, emptyrates.com, to track the experiences and sentiments of businesses affected by the tax.

It is supported by companies such as Asda, Tesco and Nokia.

Calls were also made for full relief from EPR to be granted in this year’s Budget. Under the current legislation, EPR will cost North-East businesses £40m this year alone.

Last night, the BPF threw its weight behind the Building on Success campaign, run by The Northern Echo and the North- East Chamber of Commerce (NECC), which aims to grant full relief from EPR.

James Ramsbotham, chief executive of the NECC, said the rates pose an increasing risk to North-East businesses.

He said: “Furthermore, EPR is a barrier to investment and a burden to the welfare of our region’s business property market.

“There is an increasing consensus that this legislation will be damaging for the market throughout the UK, and also that the damage will be acutely felt within the North-East where the margin between the cost of developing business premises and the profits made by letting them is lower than the national average.”

Liz Peace, chief executive of the BPF, said: “Any tax which increases as income goes down is fundamentally wrong.

“Making firms face the double hit of recession and then a tax on that recession will simply make things much worse, and that’s what we’re seeing.

Demolitions will continue, new investment won’t happen and the misery of thousands of hard working individuals will be heightened.”

■ Business leaders last night welcomed a Government move to scrap plans to increase business rates by five per cent next month – instead limiting the hike to two per cent.

Chancellor Alistair Darling said the remaining three per cent rise would be spread out over the following two years to offer “real and genuine help” to firms.