Submission to Treasury Committee in Partnership with The BID Foundation
Last week, ATCM joined forces with The BID Foundation to respond to the Treasury Committee's Inquiry into business rates.
ATCM has held long-term concerns about the increasingly out-dated rates system in a digital age. The problems became apparent to UK Parliament during the 2017 revaluation with very visible examples of how the tax no longer reflects economic reality in cities such as London and Aberdeen.
Our message has been consistent. Tax reform is not optional. It is essential. Our economy is changing, so our tax system must change with it.
With business rates acting as a pre-determined, inflexible tax in a fast moving economy, there are negative implications for many stakeholders including occupiers/taxpayers, landlords, local government and Business Improvement Districts. A new approach is required and the time to act is now.
- ATCM and The BID Foundation recommended the end of a pre-determined tax on non-domestic property, instead allowing the liability of the taxpayers to rise and fall in line with genuine economic performance.
- We recommended that the UK Government considers wider business tax reform to ensure our tax system is more responsive to mobile capital flows to offset any reduced income from business rates.
- We recommended that reform of the business tax system must take into account the whole of the UK and might require international cooperation from bodies such as the OECD to deliver a way forward.
- We recommended that the UK Government reviews and mitigates against the potential disruption to BID income via their levies, depending on the type of reform pursued.
- We recommended that reform of, and investment in, the VOA is an important step towards a fairer system and this reform must take place now prior to the next revaluation.