Retailers seek fairer system in rates rethink
A NEW rates revaluation is to be carried out with businesses urging government to learn lessons from a 2015 exercise which saw some bills treble overnight.
The Department of Finance announced yesterday it is to begin revaluing more than 75,000 properties to recalculate rates in a fairer way, with the aim of publishing a new valuation list by April 2020.
Land & Property Services (LPS) will revalue all non-domestic properties — which are mainly business premises — in Northern Ireland for rates.
The new values will be used to calculate future individual rates bills for businesses and organisations.
The LPS has said the revaluation will ensure the rating system is more up to date and will better reflect economic changes.
Glyn Roberts, chief executive of Retail NI, said: “Around 71% of our members saw an increase in their rates bills following the last revaluation in 2015.
“This cannot be repeated in 2020 and we would urge LPS to learn from their mistakes in 2015. In 2015, Retail NI had major concerns with the process and transparency of the valuation of many of our members’ stores which has to be avoided in the 2020 revaluation.
“It is welcome that we now have greater transparency with the valuation process and we will be closely working with the LPS to monitor it as we approach 2020.”
Mr Roberts added that the method used to calculate business rates needed “radical reform”.
Colin Neill, chief executive of Hospitality Ulster, said he hoped not to see a repeat of the 2015 revaluation which saw the rates bills of some hospitality businesses treble overnight.
“This enormous increase occurred because business rates in Northern Ireland had not been revalued for over 10 years,” he said.
“With rates on pubs and hotels calculated on their turnover it is even more important that revaluations take place regularly to reflect market trends and also allow businesses to plan for any increases.”
He added: “We still have issues with the turnover model used to calculate rates on pubs and hotels, with rising overheads driving down profit margins and pushing up turnover.
“It is time that actual profitability was taken into account as high turnover does not equate a high profit, nor indeed any profit.”
The Northern Ireland Retail Consortium (NIRC) said more needed to be done to what it described as “the inherent inequity” of the current rates system.
Aodhan Connolly, NIRC director, said: “The NIRC has been a strong advocate of more regular revaluations so that the rates system better reflects trading conditions, and so this announcement is a hugely positive step for the retail industry and the Department of Finance is to be commended for their progress.
“However, we need a minister in place now so we can get to the optimal three-year revaluation cycle which will allow this tax to flex with the economic circumstances in Northern Ireland.”