Portas Pilot towns hit hardest by rates delay
Stockport will be among the Portas Pilot Towns hit hardest by the Government's postponement of business rates revaluation until 2017, according to new data from the British Council of Shopping Centres and Colliers International.
The Portas Pilot Towns, which include Stockport in Greater Manchester and Nelson, Lancashire, are among those likely to lose out most as a result of the delay, the report suggests.
Business rates are currently based on the notional rental valuation as of 2008.
Rental valuations have since fallen by as much as 40%, meaning many retailers and businesses are paying rates disproportionate to the value of their units.
The substantial fall in rental values in many Portas Pilot Towns would have meant dramatically reduced rates at the 2015 revaluation.
However, the Growth and Infrastructure Act 2013 will now delay the revaluation of business rates until 2017.
Stockport, for example, has experienced a decline in rental values of 29% since 2008, meaning businesses there are likely to be paying well over the odds in terms of business rates.
Conversely, Soho and Oxford Street have seen an increase in rental of values of 11.5%, meaning effectively depressed northern towns are subsidising more prosperous southern high streets.
Stockport currently has vacancy levels of around 27.7%, with prospective retailers likely to be deterred by increasingly disproportionate business rates.
Analysis of data available from Colliers International has revealed that among those towns set to lose out the most as a result of the revaluation delay are a significant number of the Portas Pilot Towns – 27 towns singled out by Government for additional funding and assistance.
Of the 15 Pilots data is available for, 13 will be worse off as a result of postponing the revaluation.
Edward Cooke, director of policy and public affairs, BCSC, said: "The Government has really failed to engage on the issue of postponing the revaluation of property with regard to business rates.
"With one hand the government gives to these high street initiatives, but by failing to recognise the impact of postponing the revaluation, they take with the other hand.
"The Chancellor's refusal to address the impact of business rates rises in the Budget may have signalled the end for many retailers.
"Perhaps even more worryingly would-be retailers are being put off by the tax burden. The impact of government initiatives such as Portas is going to be undermined unless there are substantial changes to the business rates regime."