Labour today warned that businesses in the North East region will some of the steepest hikes in business rate outside of London and the South East in April 2014.
Labour research shows this will mean:
• The average business rates bill in North East will increase by around £360 with businesses in Stockton on Tees facing an average increase of £540
- More than 1.7 million business properties will be affected across the country
- The average business rate bill will increase to around £12,600
- The total increase in business rates will be around £700m
This increase comes on top of an average increase of £1,500 in business rates since the Tories came to office.
Labour have promised they would:
- Cut business rates on properties with an annual rental value of less than £50,000 in 2015, back to the level of the previous year.
- Freeze business rates for those properties at that level in 2016.
- Pay for the tax cut by reversing the additional cut in the main rate of Corporation Tax from 21 per cent to 20 per cent in 2015
- Ensure the measure is a centrepiece of the first Labour Budget so that businesses get a refund on their 2015 rates if Labour win the election.
Leader of the Labour Party, Ed Miliband said:
“Small businesses are the lifeblood of communities’ right across the country.
“Business rates keep going up and up. They are due to increase on average £430 this year. But David Cameron’s Government stands up for big business and ignores the needs of small business.
Commenting on the figures, Louise Baldock, Labour’s parliamentary candidate for Stockton South said:
“I recently took Ed Miliband to visit some local small businesses in Stockton and many of them told us how much they are struggling because of the huge increases in business rates on top of soaring energy bills. The government’s planned rise in rates for Stockton is a truly staggering £540 per year on average.
“The Government set these rates from Whitehall and the local Councils has no say on the matter, but is made to collect them. At time when the government should be backing small business, once again the government appears to be on the wrong side. They should give small business owners in Stockton a break and back Labour’s plans for a rate cut.”
- The level of business rates is set by the Treasury, although the revenue itself is collected locally.
Business rates increase with inflation. The rate of increase each April is set according to the rate of RPI inflation the previous September. RPI in September 2013 was 3.2 per cent, which means the business rates increase in April 2014 will be 3.2 per cent.
This year (2013-14) the average business rates bill is around £12,200.
This means that the average increase next April will be around £400. There are over 1.7 million properties in the UK paying business rates. The overall increase in business rates is therefore around £700m (1.7m properties x £400).