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Council

27 February 2019

 

Business Rates Retail Relief

 

Final Decision-Maker

Council

Lead Head of Service/Lead Director

Stephen McGinnes

Mid Kent Services Director

Lead Officer and Report Author

Sheila Coburn

Head of Revenues and Benefits Shared Service

Classification

Public

Wards affected

All

 

Executive Summary

The Government announced in the Budget on 29 October 2018 that it will provide a Business Rates Retail Discount scheme for occupied retail properties with a rateable value of less than £51,000 in each of the years 2019-20 and 2020-21.

 

The purpose of this report is to approve a Policy for awarding relief with effect from 1 April 2019 in line with the guidance issued by the Ministry of Housing, Communities and Local Government (MHCLG).

 

 

This report makes the following recommendations to this Committee:

That the Retail Relief Policy (Appendix 1) for the award of Business Rates Retail Relief in line with the guidance provided by the Ministry of Housing, Communities and Local Government (MHCLG) is agreed

 

 

Timetable

Meeting

Date

Policy & Resources Committee

23 January 2019

Council

27 February 2019



Business Rates Retail Relief

 

 

1.   INTRODUCTION AND BACKGROUND

 

1.1         The Government recognises that changing consumer behaviour presents a

significant challenge for retailers in our town centres and is taking action

to help the high street evolve.

 

1.2         The Government announced in the Budget on 29 October 2018 that it will provide a Business Rates Retail Discount scheme for occupied retail properties with a rateable value of less than £51,000 in each of the years 2019-20 and 2020-21.

 

1.3         Retail properties are described as those that are wholly or mainly used as shops, restaurants, cafes and drinking establishments.

 

1.4         Examples of properties that are considered eligible for Retail Relief are included in the Retail Relief Policy in Appendix 1.

 

1.5         Examples of properties that are not considered eligible for Retail Relief are also included in the Retail Relief Policy in Appendix 1.

 

1.6         As this is a measure for 2019-20 and 2020-21 only, the Government is not changing the legislation around the reliefs available to properties.

 

1.7         Whilst the relief is to be awarded at the discretion of the council, the Government expects local authorities to include details of the relief to be provided to eligible ratepayers for 2019-20 in their bills for the beginning of that year.

 

1.8         The value of the relief will be one third of the net Business Rates bill, after

mandatory reliefs and other discretionary reliefs have been applied.

 

1.9         The eligibility criteria is set out in the Ministry of Housing, Communities

and Local Government (MHCLG) guidance, which has been incorporated into the Retail Relief Policy.

 

1.10     Authorities should determine for themselves whether particular properties

are eligible for the relief.

 

1.11     It is estimated up to 1,000 businesses could be eligible for the relief, the cost of which will be fully reimbursed by Central Government.

 

1.12     Ratepayers that occupy more than one property will be entitled to relief

for each of their eligible properties, subject to State Aid De Minimis limits.

 

 

 

2             CONSIDERATION BY POLICY AND RESOURCES COMMITTEE

 

2.1     This policy was considered by the Policy and Resources Committee on 23 January 2019. The Committee resolved to recommend the policy to Council for adoption. An extract of the minutes can be found in Appendix 2 to this report.

3             AVAILABLE OPTIONS

 

3.1     Option 1 – do nothing option. This option would not assist those

          businesses that the Government intends should benefit from relief.

 

3.2     Option 2 - The council could restrict the scheme to only apply in certain

          parts of the borough, fewer categories of properties or provide a lower

          level of reduction.  In doing so it would limit the level of central

          government funding that is being brought into the borough to support

          retailers.

 

3.3     Option 3 - The council could extend the scheme to include those retailers the government is not recommending for relief, but the additional cost would need to be met by the borough council.

 

3.4     Option 4 – Award relief as described in the Retail Relief Policy in Appendix

 

 

 

 

3        PREFERRED OPTION AND REASONS FOR RECOMMENDATIONS

 

3.1     Option 4 is the preferred option as the council will be fully compensated

          for any relief given.

 

3.2     Applying Option 4 will mean the relief is awarded in line with the

          intentions of central government to assist retailers.

 

 

 

4        RISK

4.1     In introducing a scheme which is limited for 2 years, the council risks

          ratepayers perceiving a disproportionate increase in their rate liability

          when the scheme ends. 

 

4.2     The restrictions on state aid are complex and are likely to be unfamiliar to

          many small businesses, resulting in an increase in enquiries. 

 

4.3     To mitigate this risk, an explanatory note will be issued to those

          businesses that qualify for relief.

 

 

 

 

5        CONSULTATION RESULTS AND PREVIOUS COMMITTEE FEEDBACK

 

5.1         No consultation is necessary.

5.2        This policy was considered by the Policy and Resources Committee at its meeting of 23 January 2019. Please see Appendix 2 for a minutes extract.

 

 

6        NEXT STEPS: COMMUNICATION AND IMPLEMENTATION OF THE

   DECISION

 

6.1        Details of the relief will be made available on the Council’s website and issued with Business Rates bills

 

 

7         CROSS-CUTTING ISSUES AND IMPLICATIONS

 

 

 

Issue

Implications

Sign-off

Impact on Corporate Priorities

Securing a successful economy for Maidstone borough

Sheila Coburn, Head of Revenues and Benefits Partnership

Risk Management

Risk implications are set

out in section 4 of the

report.

 

Sheila Coburn, Head of Revenues and Benefits

Partnership

Financial

None as the amount of relief awarded will be fully met by Central Government

Finance Team

Staffing

Relief will be awarded using existing resources

Sheila Coburn, Head of Revenues and Benefits Partnership

Legal

Section 47 of the Local Government Act 1988 gives billing authorities discretionary rate relief powers that enable the Council to operate the proposed scheme.

 

Central government will fully reimburse local authorities for the local share of the discretionary relief through a grant under section 31 of the Local Government Act 2003.

 

There are no consequences arising from the recommendation that adversely affect or interfere with individuals’ rights and freedoms as set out in the Human Rights Act 1998.

Keith Trowell, Team Leader (Corporate Governance), Legal Services

Privacy and Data Protection

 Accepting the recommendation may increase the volume of data held by the Council.  The data will be held and processed in accordance with the data protection principles contained in the Data Protection Act 2018.    

Keith Trowell, Team Leader (Corporate Governance), Legal Services

Equalities

Equalities have been considered and no impact has been identified.

 

Equalities and Corporate Policy Officer

Public Health

No impact identified

Sheila Coburn, Head of Revenues and Benefits Partnership

Crime and Disorder

No impact identified

Sheila Coburn, Head of Revenues and Benefits Partnership

Procurement

No impact identified

Sheila Coburn, Head of Revenues and Benefits Partnership

 

8     REPORT APPENDICES

 

Appendix 1 – Retail Relief Policy

 

Appendix 2 – Policy and Resources Committee Minutes Extract from 23 January 2019

 

 

9     BACKGROUND PAPERS

 

None