Osborne finally confirms Business Rate review in Autumn Statement

Chancellor George Osborne has finally buckled to pressure from UK businesses and announced a review into Business Rates in his Autumn statement today.

The Autumn statement used to be an update on the general economy but is now a second budget in all but name, attracting the same amount of comment and speculation.

Today's announcement follows years of lobbying from business and retail groups on the 'unfair' system that penalises companies which require a physical or retail presence, whilst allowing online businesses with a smaller building footprint to enjoy an unfair tax advantage. For example, Harrods and the online retailer ASOS both have similar turnovers, of £716.3m and £769.4m respectively, but Harrods faces a business rates bill of £11.5m in 2014-15, while ASOS is set to pay £935,000.

As a result, the Chancellor has announced that:

  • A full review into the structure of Business Rates
  • Business Rates Relief doubled for a further year
  • Inflation linked increase capped at 2%
  • An increase in the business rates discount to help small high street shops, pubs and cafes by 50% to £1,500 next year.

Other highlights include:

  • OBR – UK growth forecast raised for this year to 3.0%
  • Borrowing forecasts for this year up to £91.3bn. A surplus is not expected until 2018/19
  • New legislation to stop large companies shifting profits off shore
  • Non- doms to pay more for the privilege of living in the UK
  • UK Banks' ability to offset tax against losses made in the Recession are limited to 50%
  • Full scale revamp of stamp duty on homes

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