The impact of the pandemic on trading conditions for local businesses, and the added pressure on the Business Rates service resources to administer the Government’s business support grants, has made 2021/22 the most difficult year ever for the collection of business rates.

The Strategic Director Corporate Resources will submit a report (Document “AC”) which sets out the Council’s performance in, and the challenges for, the collection of Business Rates. The report also considers the impact of changes to the business rates system recently announced by Government.

Recommended –

That this committee notes, and gives its view on, progress in the collection of Business Rates.

(Martin Stubbs – 01274 432056)

The report of the Strategic Director, Corporate Services, (Document “AC”) set out the Council’s performance in, and the challenges for, the collection of Business Rates. The report also considered the impact of changes to the business rates system recently announced by Government.

Document “AC” reported on the impact of the pandemic on trading conditions for local businesses and the added pressure on the Business Rates service resources to administer the Government’s business support grants which had made 2021/22 the most difficult year ever for the collection of business rates.

Members were aware that, as part of its response to the pandemic, the Government had introduced the Expanded Retail Discount (ERD) scheme and the Nursery Discount scheme to help mitigate the impact of restrictions and limitations on the ability to operate and trade

As a consequence of the ERD scheme the Council had significantly less business rates to collect during 2020/21 and 2021/22 than in previous years.  A table of collection rates was provided in the report.  Members were advised that since March 2020 the focus of the service had been on processing grant payments Not all businesses were supported by the Government schemes and had full business rates to pay.  Reminders for late payments had been issued and the service had been receptive to struggling businesses.  Assurances were provided that enforcement through the courts had been a last resort in an endeavour to enable businesses to continue to operate and provide employment.

It was reported that the Government had undertaken a national business rates review.  No detailed consultation had been received, however, Members were assured that details would be provided when that was received. 

The assistance available to businesses at the current time was questioned and it was explained that many had been assisted with in excess of £228 million being provided to 17,000 businesses.  The ERD scheme had been extended to 31 March 2022, however, from 1 April 2022 those businesses would be entitled to 50% business rate relief capped at £110,000.

Members noted the significant reduction in collection rates contained in the report and questioned the likelihood of achieving 70 to 80% collection rates over time.  In response it was stated that it was envisaged that collection rates of 97/98% could be achieved over a 5-year period.  It was confirmed that in year collections were always low but were paid over time, however, the difficulty to be faced would be how businesses survived the pandemic.

It was queried who paid successful court refund challenges as the business rate collected was divided between the Council which retained 49%, central government which retained 50% and the West Yorkshire Fire Authority which received 1%.  It was explained that rating appeals were funded proportionally to reflect how they were retained. 

A Member questioned what action was being taken with regard to fraudulent claims for support and was advised of actions taken against 60 claims up to the end of January 2022.   Awareness and knowledge of fraud had increased and processes had been improved. 

Whilst it was acknowledged that it was outside of the Council’s control concern was expressed about the ability for companies to dissolve their businesses and reopen under a different name.

Resolved

This Committee requests that a progress report be presented in 12 months, which also focuses on the impact of the Governments Business Rate Review.

Action: Strategic Director, Corporate Services