Council officials charged with collecting business rates on empty property are universally opposed to the tax, according to brand new research carried out by real estate adviser Atisreal for the British Property Federation.
Every respondent to a survey sent to local billing authorities disagreed with the legislation, with over half of respondents said the extra cost to their councils was as much as 20% through the administrative burdens associated with the tax.
Half of respondents also saw the extra rates revenue to the government as between 5 and 40%. Furthermore, the legislation has affected the billing authorities even more with over a third seeing their annual rates liability increase by over 4%.
A number 10 petition has nearly 5,000 signatures, while over 120 MPs have signed Commons motions against the tax. Those affected are encouraged to sign up at: http://petitions.number10.gov.uk/emptythreat/
Liz Peace, chief executive of the BPF, said: “This is clearly creating many problems for local authorities as well as small and large businesses. We have evidence of councils wasting public money paying empty rates and demolishing public buildings to avoid paying it. The fact that the rates collectors oppose the tax is unsurprising and it’s clear that the damage being done by empty rates is affecting people far outside the property industry.”
Alan Whitelaw, head of rating at Atisreal, comments: “Not only is the empty rates legislation a burden to an already suffering property industry, but it is a burden to the local authorities too, who are having to pay to enforce it and who wholeheartedly disagree with it!”
Over two thirds of the billing authorities also noted that the number of court summonses for non-payment of rates had risen as a result of the legislation and a quarter of respondents saw a rise in bailiff visits increasing.
Whitelaw continues: “It is also disturbing to hear that court summonses and bailiff visits have increased since the legislation has been brought in. These are often small family businesses that have had to shut down due to the economic crisis and are now being crippled by rates bills on their property on top.”
Derby council has 54 empty properties, giving rise to a rates bill of £112,030; Bristol has 56 empty properties, amounting to a rates bill of £381,346. Swindon Borough Council currently has 24 empty properties upon which it pays empty rates, the annual rates payable on these is £169,051.45. While there are 691 non council owned empty properties in the whole of the Borough. The rates due on these 691 is £8,359,419.
Nick Martin, lead member for finance at Swindon Borough Council, said: “We are spending public money demolishing buildings to avoid this ill-thought out stealth tax. Gordon Brown should be ashamed of making people whose properties are empty pay even more tax, thus making a bad situation even worse. It is another Labour stealth tax on hardship.
“Swindon, like many other towns across the country, could suffer if regeneration projects are shelved as a result of this. We want MPs to take note and for the government to urgently reapply the relief on empty property.”
Firms with properties in Birmingham are currently liable for £23 million in business rate payments on empty buildings while the city council itself faces rates charges of more than £817,000.
Mike Whitby, leader of the council, said: “The Government’s current ‘tax now, ask questions later’ policy is threatening growth and suffocating vital new developments.”
Middlesbrough council owns 20 empty properties resulting in a rates bill of £46,727.
Ashok Kumar MP for Middlesbrough South and East Cleveland said: “In these troubled times securing rate relief on empty properties could be critically valuable to many small firms as that cash amount could make the key difference between expansion or contraction.”
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