Free cash machines in tax row

SHOPS and petrol stations may have to scrap free ‘hole in the wall’ cash machines after losing a key court battle over business rates.

A tribunal ruled that cashpoints built into the front of outlets should have a separate business rates bill.

The ruling, upholding a previous decision from 2013, means retailers with free cash machines may be forced to close them or start charging for them. In many towns these ATMs in garages and shops are the only ones left as bank branches have shut.

More than half a million firms have already been hit by steep rises in their business rates after the first revaluation in seven years kicked in at the start of this month.

The judgment by the Upper Tribunal, published on Thursday, follows a long-running case brought by a raft of businesses, including Sainsbury’s, Tesco and the Co-op, as well as ATM operator Cardtronics europe. Retailers were incensed by the Government’s 2013 decision to charge rates on hole in the wall cashpoints, which saw bills sent to thousands of stores the following year.

After losing the court battle, shops face having to pay an average of almost £2,800 more tax on cash machines as part of the business rates hikes, sparking fears many will no longer be able to afford offering cashpoints for free.

Retailers’ hopes of clawing back £200 million in rebates for past tax paid have also been dashed, and they face a £206 million bill for the next five years under the revaluation.

Figures compiled by rents and rates specialists CVS showed the hefty hikes in business rates are costing retailers £39.3 million a year. The number of cash machines liable for business rates has surged from 3,140 in 2010 to 14,068 this year.

Almost one in six business rates appeals currently lodged – more than 196,000 – relate to cash machines, according to CVS.

The Association of Convenience Stores wants to see local authorities use funds announced in the Budget to reduce the burden for retailers.

Its chief executive James lowman said: ‘Sadly this ruling will make it harder for retailers to offer free-to-use cash machines. This will have wideranging and damaging implications.’

He added that the ruling ‘shows what a mess the business rates system is in’ after the revaluation.

CVS described the move to charge rates on cash machines as a ‘stealth tax’ and said it could deprive many communities of access to money.

A CVS spokesman said retailers are expected to lodge an appeal against the ruling but in the meantime ‘there won’t be any respite in tax liabilities which is going to hit small retailers and forecourts the hardest’.

The Government faced a backlash from firms and its own MPs over its business rates revaluation. Although ministers said the majority of firms would see their rates fall or stay the same, about half a million face increases of up to 3,000 per cent.

After the outcry, Chancellor Philip Hammond introduced a £300 million relief fund to help those hardest hit.

CUSTOMeRS may soon be able to get a bank account or mortgage using a cash machine.

A new type of ATM set to be introduced next year will allow you to talk to staff by video call, sign your name electronically and take a photo of yourself or documents.

US makers NCR said the devices would make banking easier and safer, but critics fear it could lead to even more traditional branches closing.

‘The system is in a mess’