Agenda item

Business Rates - Changes to Rate Reliefs and Discounts for 2020/21

To seek Cabinet approval for administration of the changes to Business Rates relief and discounts for 2020/21 (report of the Portfolio Holder Finance and the Executive Director Commercialisation enclosed).

 

Minutes:

Consideration was given to the report of the Portfolio Holder for Finance and the Executive Director Commercialisation (S151) to seek Cabinet approval for administration of the changes to Business Rates relief and discounts for 2020/21.

 

The Portfolio Holder for Finance provided the following Briefing and Aid Memoir in addition to the report:

 

Briefing and Aid Memoir – Cabinet 17 March 2019

Report: Business Rates – Changes to Rate Reliefs and Discounts for 2020/21

This report seeks Cabinet approval for the administration of changes to Business Rates reliefs and discounts for 2020/21 announced in the Written Ministerial Statement on 27th January 2020, as set out in section 1.2 of this report.

However recent events have now overtaken this report. 

In response to COVID-19, at Budget 2020, the Government announced it would provide additional business rate support to some small businesses.  The Chancellor announced as a temporary measure for 2020/21 that he would: -

  • Increase the level of the retail discount to 100 per cent for eligible retail businesses occupying a property with a rateable value of less than £51,000;
  • Expand the retail discount to include hospitality and leisure properties, with a rateable value of less than £51,000 (such as museums, theatres, gyms and hotels);
  • Increase the level of the pubs discount up to £5,000 for pubs with a rateable value of less that £100,000.

The government is clear that it expects local authorities to use their discretionary relief powers to grant these discounts in line with the relevant eligibility criteria.  No new legislation is required, and authorities will be compensated for the cost of granting the discount.  State aid rules will apply to these discounts in the normal way.

The Ministry of Housing, Communities and Local Government (MHCLG) will shortly publish updated guidance for local authorities reflecting the changes to retail discount as well as refreshed guidance on the pubs discount.

-          In addition to these measures, the government has announced small business grant funding of £3,000 for small businesses already benefiting from paying little or no business rates due to eligibility for Small Business Rate Relief (SBRR) or Rural Rate Relief.  This will help those businesses meet ongoing business costs.  The Government will publish guidance to help local authorities implement the grant.

As such, in addition to the two recommendations in this report, an additional recommendation is made to Cabinet today to: -

‘Approve the implementation of the additional business rates support as a temporary measure for 2020/21 as announced in the 2020 budget in response to COVID-19’. 

This will enable the prompt administration of the additional support to businesses, in line with the latest government guidance.

 

Members were advised by the Portfolio Holder Finance that communications would be issued in due course advising business owners how to apply for support and which category they fall into. 

 

The Chief Executive confirmed that the Council was awaiting further information and guidance and that the Inward Investment Manager was working proactively with businesses.

 

DECISION:

 

a)  That Cabinet approve the implementation of the changes to Rate reliefs and discounts as set out in the report

 

b)  That Cabinet approve updating the Discretionary Rate Relief Policy to reflect the changes in the latest government guidance and that the S151 Officer will approve the final wording in consultation with the Portfolio Holder for Finance

 

c)  That Cabinet approve the implementation of the additional business rates support as a temporary measure for 2020/21 as announced in the 2020 budget in response to COVID-19

 

(Other options considered:

  • There were no alternative options for consideration.

Reasons for decision:

  • Administration , in line with Government expectation on local authorities, would ensure qualifying businesses in South Holland were supported at the start of the new financial year, with the additional reliefs and discounts.)

Supporting documents: