A proposal to digitalise the existing business rates system could see government grants become more targeted towards independent businesses, experts have said.
Currently, business rate bills are sent out and collected by local councils. Under the new proposals, information on funding would be moved to a central computer database, meaning local authorities could be acting on behalf of central government or HMRC. If approved, the government said the new system would lead to “more effective compliance” among businesses who pay rates.
Explaining what this means for retailers, chartered surveyor Ian Sloane said: “Possibly, and much more importantly to the chancellor, it will allow any future grants to businesses to be more targeted. The Covid grant scheme was essential, but a massive financial blow to the Treasury, which had no idea how to hand out money except via those with a rateable value. It had no idea who would need relief and which companies had reserves available to sustain them through the pandemic.”
However, the proposals did face criticism from some organisations. John Webber, head of business rates at real estate consultancy Colliers, said: “While there are some strong merits in the new proposals, in particular this might help central government in the distribution of reliefs and grants, it does beg the question about the long-term role of local authority finance.”
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