The economic background for the Downing Street newcomers, Sunak and Hunt, could hardly be gloomier. Finances that would normally be diverted by businesses into investment are leeching away in higher energy bills, which will also have an as yet unquantifiable effect on consumer spending.
Mindful of the reckless promises by Truss and Johnson, undelivered and presumably forgotten, the new regime will prove far more pragmatic, and even risk unpopularity by increasing, if necessary, income from taxes, to weather the current crisis.
Worth £26bn to the UK economy, the Sunak government is unlikely to reform radically our business rates.
With the sticking plaster of emergency discounts currently being removed from our rates bills, it is clear that the financial wounds caused by Covid are by no means healed. (Not to mention that an estimated 33% of firms received not a penny from the schemes!)
Given that in line with the CPI bills could rise by 10% at least, the retail, leisure, and hospitality sectors face a hike of £1.7bn. while the total increase in business rates is estimated to be £4.7bn.
The more sombre economic climate overseen by Jeremy Hunt and Rishi Sunak is unlikely to magic up targeted discounts unless the market signals widespread inability to pay its rates bills.
According to Lloyds Bank, no other economic sector in the UK has contracted faster than the hospitality industry. data from September 2022 reveal. Overall demand has fallen for the fourth consecutive month, a clear sign that customers are tightening their belts.
For non-domestic rates to be affordable by our pubs, hotels, and places of entertainment, they cannot be allowed to rise further. Indeed, they should be reduced, wherever necessary, to keep doors open to the public.
Unfortunately, considerable business rates change for the hospitality, leisure, or retail sector is unlikely. The only current way to control a reduction in your rates is through a business rates appeal!
For these appeals to be successful, they will benefit greatly from the experience of specialist surveyors and those acquainted with sophisticated data sets and persuasive local comparators.
However, since many firms will leave their appeals until the very last minute, there is bound to be a backlog meaning that many claims will be "timed out". To avoid this misfortune, and in the expectation that rates will generally rise in 2023, regardless of market rental conditions, we urge businesses to conduct a thorough audit, based on sound surveying and statistical data, as soon as possible.
We know that the 2023 Rating List will bring sectoral change, as a long-awaited opportunity to eliminate anomalies and make rates more affordable and realistically targeted, we want to see the Chancellor regard the hospitality industry, as so much a part of any urban regeneration, not mention our tourist trade, with especial compassion. A special case.
Appeals lodged before Christmas stand the best chance of receiving the Valuation Office's attention, before the expected flood of 2023, and the risks of a backlog and consequent failure to be considered in time by the VO.
For the Valuation Office to base its 2023 calculations on accurate, up-to-the-minute assumptions, please contact us today for a free, no-obligation consultation.
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