Government ministers are facing strong opposition over proposed changes to business rates that could have a disproportionate impact on rural businesses. Unless plans are changed, the new rates will come into effect from April 2017.
920,000 businesses will benefit from the changes, and rates will remain the same for another 420,000. 510,000 however are expected to be hit by increases. Experts warned that countryside businesses, such as vineyards, kennels and stud farms, would be among the worst affected.
The rates are the equivalent of council tax, and are calculated partially based on the rentable value of a property. All businesses with properties with a rentable value above £12,000 must pay the rates.
Tim Farron MP, the Leader of the Liberal Democrats who represents the rural seat of Westmorland & Lonsdale, said:
“Treating rural businesses as a cash cow is short-sighted and threatens their viability. Rural businesses are vital to supporting rural growth and jobs. We should be looking to support them where necessary through special exemptions, not slapping them with an even larger tax bill.”
Glyn Davies, the Conservative MP for Montgomeryshire, even suggested that there could be a “rural uprising” over the proposed changes.
As well as MPs, local authorities and businesses, groups that represent the countryside have also criticised the proposed changes. Sarah Lee, the Head of Policy at the Countryside Alliance said that:
“Unfortunately it would appear that many of these rates decisions have been drawn up behind a desk and are blind to the realities and needs of rural businesses. This is in effect a bricks-and-mortar tax based on the size of the premises not the profitability of an individual businesses and risks hammering rural businesses if the revaluation is not handled with care.”