A DECADE-long legal wrangle which has ended with a North Yorkshire museum’s business rates being slashed has raised hopes others in the region will also benefit.

A landmark victory for the York Museums Trust, which operates the York Castle Museum, will cut the organisation’s rates bills following a legal battle with the Valuation Office Agency (VOA).

A Trust spokesman said the rateable value of its properties had been reduced by £120,000 against their original listing following a revaluation of the Yorkshire Museum and Gardens down to just £1 to reflect the high costs of maintaining such a historic and complex site.

"Had the VOA been successful, the rates liability for the museums could have increased significantly," he said.

"Instead the appeal successfully saved the Trust nearly £100,000 in backdated rates bills."

The unprecedented decision could reduce business rates for around 767 museums nationwide.

York Museums Trust argued their case at an Upper Tribunal hearing for its rates to be based on net income, rather than the cost of rebuilding, which the VOA had traditionally used for many museums.

The spokesman added: “The Tribunal also agreed that the York Castle Museum shop and the Hospitium were occupied by the Trust and not just its commercial arm, York Enterprises Ltd, so was eligible for the standard 80 per cent charitable relief.”

The VOA had brought the appeal forward to the Upper Tribunal in a bid to separate out all shops and cafes, and the Hospitium, which formed part of St Mary’s Abbey in the Museum Gardens, and the tribunal agreed that all but one of the shops should be valued as part of the museum.

Colin Hunter, of commercial property consultancy Lambert Smith Hampton, which acted as the Trust’s expert witness, said the appeal outcome reflected more than a decade of discussions with the VOA on behalf of the trust and the Association of Independent Museums.

"This decision will not only help museums in York, it could also help the 767 museums valued on this basis in England and Wales," he said.

“The VOA’s attempt to separate out the values of shops and offices is the most financially damaging aspect of the case.

“Had their appeal succeeded, its implications would not only affect museums, it would have significant repercussions for any charity with a trading subsidiary.”

The Castle Museum will have a rateable value of £183,000 per year, while York Art Gallery, including the shop and café, will stand at £70,000.

Mike Woodward, York Museums Trust chief operating officer, said: “We are pleased that we have been able to successfully argue the case for what we believe is a much fairer way of paying rates on the buildings and spaces we run and maintain.