Business rates on empty commercial property have long been a contentious issue for property owners and businesses alike. These rates are set by local authorities and are payable on most non-domestic properties, including offices, shops, and warehouses. The rates are calculated based on the rateable value of the property, which is determined by the Valuation Office Agency (VOA).
Empty commercial properties are subject to business rates for a number of reasons. Firstly, the rates help to fund essential local services such as education, roads, and waste collection. By charging rates on empty properties, local authorities are able to raise much-needed revenue to support these services.
However, the imposition of business rates on empty commercial property is often seen as unfair by property owners. In many cases, vacant properties are not generating any income for the owner and are often a financial burden. The rates can add to this burden and make it harder for property owners to find tenants or buyers for their properties.
One of the main criticisms of business rates on empty commercial property is that they can discourage property owners from investing in their properties. If owners know that they will have to pay rates on an empty property, they may be less inclined to refurbish or improve the property in the hope of attracting a tenant. This can lead to properties falling into disrepair and blighting local areas.
Another issue with business rates on empty commercial property is that they can deter businesses from relocating to certain areas. If a company is considering moving to a new area but knows that they will have to pay rates on an empty property while they renovate or fit out the space, they may choose to locate elsewhere. This can have a negative impact on local economies and communities.
There have been calls for reform of the system of business rates on empty commercial property to make it fairer and more supportive of property owners. Some suggestions include introducing exemptions for newly built properties that have not yet been occupied, reducing the rates payable on empty properties, or linking rates to the length of time that a property has been vacant.
In recent years, there have been some changes to the way that business rates on empty commercial property are calculated. In 2017, the government introduced a temporary relief scheme which reduced the rates payable on long-term empty properties. This was seen as a positive step towards supporting property owners and stimulating investment in vacant properties.
Despite these changes, the issue of business rates on empty commercial property remains a hot topic for property owners and businesses. The cost of rates on empty properties can be a significant financial burden and can make it harder for owners to bring their properties back into use.
In conclusion, business rates on empty commercial property have a significant impact on property owners and businesses. While these rates are essential for funding local services, they can also deter investment and development in vacant properties. There is a need for ongoing dialogue and potential reforms to ensure that the system of business rates on empty commercial property is fair and supportive for all stakeholders.