Expert says rates increases are ‘no joke’ for businesses

Ratepayers should consider appealing huge rises

April 1 heralds the commencement of a rating revaluation of non-domestic properties throughout Scotland.

With this in mind the Assessor for the Tayside Valuation Joint Board recently published the new Rateable Values (RVs) for all commercial properties in the area and many businesses will be in for a very unwelcome shock.

Initial analysis reveals that pubs and restaurants, filling stations, hotels and car showrooms across Tayside face a substantial hike in rates.

The Forfar Road Filling Station in Dundee is the hardest hit, seeing a 212% increase in its rateable value from £31,000 to £96,800.

The Old Bank Bar in Dundee has the second-highest rise, with its RV rising 183% from £28,500 to £80,700.

Additional examples of jumps in RVs for Tayside ratepayers include a car showroom on Dunkeld Road, Perth, with a 42% increase from £72,200 to £105,000 and Fonab Castle Hotel in Pitlochry with a 153% rise from £77,500 to £196,000. Dundee’s Malmaison Hotel is seeing a 31% increase from £285,500 to £375,500.

The Scottish Government has also confirmed there will be no transitional relief. This will have an immediate impact on many businesses in Tayside as the full effect of the increase in RV will be felt from April 1.

Had transitional relief been applied this would have limited the dramatic and sudden impact of the rates increases, particularly for those businesses facing large increases in their RV.

There is some good news however, as the Uniform Business Rate, which is multiplied by the RV to arrive at a business’ rates bill, is set to be decreased by the Scottish Government from 48.4p to 46.6p for those with an RV of up to £51,000 and from 51p to 49.2p for values of £51,000 and over.

The threshold to obtain 100% relief under the small business bonus scheme has also been increased to £15,000.

This move will exempt 100,000 properties in Scotland from paying rates.

Larger businesses, however, will bear the brunt of these new proposals.

All commercial ratepayers should therefore take a long, hard look at their new RVs, which will remain in place for at least five years, and seriously consider taking steps to lodge an appeal.

It is important to look at making an appeal even if a RV has decreased, as it may not have reduced enough.

The appeal window is short, from April 1 to September 30 this year, and once the latter date has come and gone the opportunity will be lost.

Fonab Castle in Perthshire is facing a huge hike in its rateable value from April.

Fergus McDonald believes many businesses are in for an unwelcome shock.