Our Thoughts
Tue, 23/03/2021 - 12:00
· 2 min read

Offices Still Waiting for COVID-19 Rates Reductions

Valuation Office Agency yet to resume negotiations.
 

A year on to the day from the Prime Minister’s address to the nation in which he ordered people to stay at home, there remains no relief from business rates for sectors other than retail, leisure and hospitality.
 
In his recent budget, the Chancellor extended 100% Retail Rate Relief for occupiers in these sectors in England and Wales to 30 June 2021, with more stringent criteria to apply from 1 July.  In Scotland, the 100% Retail Hospitality Leisure and Aviation Relief has been extended to 31 March 2022.
 
During the pandemic, office occupancy has decreased to as little as 5% and in some cases, total closure, whilst manufacturers have seen a decline in output due to social distancing measures, suggesting that rental values may have fallen, which should be reflected in reduced rating assessments.
 
BNPPRE and other leading firms had been engaged in constructive negotiations with the Valuation Office Agency (VOA).  Points of principle were being established, with each party having sought legal opinions from leading barristers.  With the principles being narrowed, attention had turned to discounts in value, although the VOA paused discussions before Christmas.
 
A negotiated settlement is in all parties’ interests. Businesses wish to avoid a lengthy procedural Challenge process in England - which for many is scheduled to start in the summer - and they require an immediate retrospective saving to their major fixed cost of business rates.
 
Legal advice supports action taken to seek reductions to rating assessments. It is not a question of if, but by how much, assessments should be reduced. We therefore fully support the Rating Surveyors’ Association’s call for the VOA to return to the negotiating table, or to take some form of positive action.
 
In Scotland, the situation is similarly challenging. BNPPRE is a member of the Scottish Business Ratepayers Group, who have made representations to the Scottish Assessors Association and we are awaiting their response.

Offices Still Waiting for COVID-19 Rates Reductions