After effective negotiations and some successful appeals, the overall business rates bill for Ludlow has gone down. The town had been facing above average increases after the revaluation of properties last year. It is still facing above average increases but more than seventy businesses have had their rates bills reduced since the increases were announced. One in nine Ludlow businesses will see a reduction in rateable value and the changes have moved three local businesses out of the business rate regime altogether. The reduction in rateable values for those businesses that pay rates under the current rules amounts to £120,000. That’s a 10.4% reduction and good news for local companies and traders.
This was a measly and mean budget for small businesses. For towns like Ludlow, there is no cheer at all from the Budget statement today.
In recent days, there were growing hopes the Chancellor would do act to ease the rates burden on business, especially the retail sector. Philip Hammond made three announcements on business rates and none of them pass muster.
Today’s budget will lead to many local independent businesses going to the wall. I really fear we are set to lose several of the businesses that attract people to Ludlow’s town centre.
Yesterday, the communities and local government minister, Sajid Javid, made a Commons statement on business rates. He defended the changes in rateable values being introduced on 1 April. These rises have led to protests across the country, including here in Ludlow. Our town has featured in the national media several times in recent weeks.
The government must grasp the opportunity to address the “squeeze in the middle”. This squeeeze threatens the future of independent shops and pubs, here in Ludlow and across the country.
A few years back, the government of the day spotted a banana skin ahead. A routine reassessment of rateable values due in 2015 would lead to some businesses paying a lot more in business rates. With London and the South East beginning to boom again after the banking crisis, that would mean a huge increase in business taxes in Tory heartlands. So, ministers kicked the revaluation into touch until after the 2015 general election. There was no point in having a row with business leaders just as electors queued at the polling booths. And, as the government pleaded at the time, the country was still struggling to get out of recession.
This was at best confused thinking. At the worst, it was cowardice. Whatever the motive, the business rates revaluation was delayed for a couple of years. It is now upon us. For Ludlow, it is becoming the biggest media story in town because the government is perilously close to permanently damaging the retail economy of towns like Ludlow.
The Times has run a series of articles highlighting the harm that rises in rateable values and business rates will cause rural businesses. Yesterday, the newspaper had a first page headline: “Punitive business rates threaten rural way of life.” I am sure there were a lot of responses and four of us were lucky enough to have our letters published in today’s edition.
My letter, as you might expect, concentrated on the impact on business rates hikes in Ludlow. I said “Our fear is that these independent shops will fold and will be replaced by the chain retailers”: