BUSINESSES in the region are set to reap a multi-million pound windfall thanks to a long-awaited shake-up in rates.

Council chiefs hope the sweeping changes – which will see businesses in the South paying more and businesses in the North paying less – will give ailing town centres a much-needed shot in the arm.

The Government announced earlier this month that following its review of business rates – which are calculated on a commercial property’s value – that overall bills were set to rise by an average of 9.1 per cent.

However, because the property market in the North-East has seen prices stagnate or fall, many businesses in the region will see a reduction in their bills when the new prices come into effect in April 2017.

Councillor Bill Dixon, leader of Darlington Borough Council, said business rate payers across Darlington will collectively be an estimated £2m to £2.5m better off once the reductions come into force.

He said: “Within that there will be some losers because there will be some properties that for whatever reason their value has gone up.

“Overall it is good news, but not everybody is going to be a winner.”

Durham County Council’s head of corporate finance and HR, Jeff Garfoot said it is estimated that business rates across the whole county will drop by five to ten per cent, resulting in savings of £6m to £12m annually for businesses.

He added: “It is important to note however that the impact upon individual businesses will depend very much upon the type of business and the individual variation in rateable value of each business.

“The overall projected drop will be good news for the majority of businesses across the county and together with the innovative support and business initiatives that we run here as a council, will hopefully incentivise more enterprises to consider County Durham as a vibrant place for investment.”

In Redcar and Cleveland, the rateable value for businesses will reduce by more than £23m.

This is mainly due to a material change in circumstances surrounding the SSI steelworks site, Cllr Christopher Massey, cabinet member for resources at Redcar and Cleveland Borough Council, explained.

He added: “There has been a reduction in rateable value for shops by around £1.8m which is likely attributed to a reduction in market rent levels for the area and property prices. There is no evidence at this stage of any large scale ‘plummeting’ of rate levels.”

In Middlesbrough there are hopes that reduced rates could tempt new businesses into the area.

A council spokesman said: “Clearly any potential fall in rates could benefit Middlesbrough business, in particular acting as an incentive to start-up businesses locating in this area, and that in turn can only support the ongoing regeneration and business growth the town is currently experiencing.”

Although reduced rates will mean a drop in business rate income received by councils, they should not lose out overall due to increases in central government grants.

Jonathan Walker, head of policy and campaigns for the North-East England Chamber of Commerce, was cautiously optimistic about the new rates but said that the whole business tax system remains too complicated.

He said: “We welcome the fact that it does look like the overall (rates) trend is going to be slightly downwards for businesses in the North-East, which is obviously good news and it will lessen the burden of business rates for those who are going to pay less.”

However Mr Walker warned that we should “not get carried away” in predicting the impact of the rate reductions because he expects changes to be minimal.