‘Make it fair or I won’t pay you’
Midland hotelier demands overhaul of tax system that is crippling businesses
If you want to take me to court do so, if you want to send me to prison then so be it Hotelier Rick Cressman
THE owner of a historic Midland hotel says he is prepared to go to jail if necessary as part of a battle over business rates.
Rick Cressman owns Nailcote Hall in Berkswell, a country house hotel set in 15 acres of countryside in Warwickshire.
The former stately home near Solihull dates back to the 17th century and was damaged by Oliver Cromwell’s troops in the English Civil War.
Now a four-star hotel, spa and golf course, it is in the process of preparing to reopen and get back on track in the wake of the pandemic.
Mr Cressman says he is taking a stand over business rates as he is disillusioned with the lack of government support for the hotel sector during lockdown.
He says that hotels have been virtually ignored at the expense of pubs and restaurants.
Mr Cressman, who rescued Nailcote Hall out of administration 30 years ago and has built it up as a successful leisure business, says he has huge bills to start paying to the Government at the same time as trying to get the business back up and running and believes the system is “unfair”.
While the hotel can reopen next month it will be a phased process, with the hotel only fully getting going on June 21, and the popular wedding venue has a backlog of more than 100 weddings.
Bills that must be paid include VAT and National Insurance backdated bills to HMRC and also business rates – which will be due at the end of June.
Mr Cressman accepts the HMRC backdated bill but is prepared to do battle over business rates.
He said: “It is a difficult time for everyone in hospitality – we have really been hammered to hell.
“We have really been badly treated. The Government thinks hospitality is pubs and restaurants and that’s it.”
And businesses like Nailcote Hall, and other standalone hotels like Coombe Abbey in Coventry have been particularly badly affected, according to Mr Cressman.
He says this is because of the range of services they offer.
Nailcote Hall has weddings and other events, entertainment, a restaurant, a health club and a Par 3 golf course.
He said: “My business is £750,000 more in debt now than a year ago.
“The Government has supported my staff but not my business.”
The hotelier said he estimates the business is currently losing £1,250 a day and though it is entitled to £18,000 of grant support as part of a recent Budget package of measures, it is too little and they have yet to receive it.
“They are giving us a few scraps,” he said.
“What they don’t understand is we are all multi-faceted leisure businesses, not just a Premier Inn which gives you a room.
“By not operating
I am
losing
£1,250 every day and we have 16 weeks until we fully reopen.
“The £18,000 will cover my business for two weeks out of those 16.” Mr Cressman used weddings as an example of how difficult the pandemic has been for businesses like Nailcote Hall and the added challenge of catching up post-pandemic. He said: “If we think about weddings, which for us is a big part of our business – particularly April
through to September – we have lost April, May and June, apart from the last nine days of June.
“It is only in July when we can hopefully start trading properly. Mr Cressman said against this backdrop he has to pay around £100,000 to HMRC as part of deferred VAT and NI payments and more than £30,000 in business rates. HMRC is suggesting the deferred bill is paid over an eight-month period but he feels two years would be more realistic.
However, his big bone of contention is over the business rates bill.
As part of Chancellor Rishi Sunak’s support measures to take account of the effects of lockdown, this has been reduced by two-thirds but Mr Cressman says that is still too much and the whole system is unfair.
“I had a letter the other day from HMRC. We have got £100,000 owing for a year ago – deferred VAT and NI,” he said.
“The letter says we can start paying now.
“I thought that’s great, we’re not even open now. That would be £12,500 a month for eight months.” He added: “What they are saying is if you have been shut the longest and damaged the most we will give you the least amount of time to pay.
“That to me doesn’t seem to make a lot of sense. They say you can go and talk to them but a lot of businesses probably need 24 months to repay, not eight months.
“It is the sense of unreality from government.”
Mr Cressman’s disillusionment with government – and business rates in particular – mean he is prepared to take a determined stand and not pay his bill unless the Government offers better support.
He is calling for business rates to be waived completely right now and for a fairer system to be put in place in the long term.
His main bone of contention is that business rates are calculated according to property value rather than a business’s turnover.
And he is keen to stress that he has contributed an estimated £20 million to the Treasury over the three decades he has run Nailcote Hall. “I am pretty angry,” he said.
“Rishi Sunak has promised opportunity and hope for everyone but I don’t really think that has been honoured, or what Boris Johnson said that viable businesses would be supported.
“Our business rates a year ago were around £100,000 out of a turnover of £2.8 million.
“That means that 3.5 per cent of every pound we earned went out the door in business rates.
“We are being asked to provide a third of our normal business rates but that is still 1.2 per cent of turnover. Amazon pay 0.37 per cent in business rates.”
He added: “This out-of-date property-based system is completely not fit for purpose.
“It is not the bricks and mortar which enables companies to pay bills but the business they do.
“A third of a bill of something as big as that is still a lot of money.
“Until they change the system the Chancellor should really have eliminated business rates this year and get a sensible system in place.”
And that is why Mr Cressman says he has reached the point where he simply won’t pay.
“What I’m saying is make it fair or I am not going to pay you,” he said.
“I don’t want to say no, but as long as it’s unfair, I’m sorry I’m not paying you.
“I’m prepared to sit here and say if you want to sue me then sue me, if you want to send bailiffs to Nailcote Hall send them in, if you want to take me to court do so, if you want to send me to prison then so be it.
“Sending a businessman who is almost 70 years, who has paid £20 million over the last 30 years to the Treasury to prison?
“I think I would actually have a lot of support.”