Agenda item

Business Rates Appeals

To consider a report from the Head of Governance and Scrutiny Support summarising key information to help prompt further discussion surrounding business rates appeals and ways of addressing local authority exposure to appeals risk and volatility.

Minutes:

Further to its meeting last month, the Scrutiny Board expressed a wish to continue discussions around ways of addressing local authority exposure to business rates appeals risk and volatility.  To help inform the Board’s discussion, the following information was appended to the report of the Head of Governance and Scrutiny Support:

 

Ø  Appendix 1 An extract from the report presented to the Scrutiny Board in November 2018 (updated to 31/12/19) detailing factors linked to the continuing volatility of business rates income, including the appeals process.

 

Ø  Appendix 2 A briefing paper on the reduction in appeals numbers in 2018/19 and the incidence of the cost of appeals provisions since 2013/14.

 

In attendance at the meeting were:

·  Councillor James Lewis – Executive Member for Resources and Sustainability

·  Doug Meeson – Chief Officer, Financial Services

·  Richard Ellis – Head of Finance

·  Mark Amson – Business Rates Manager

 

In consideration of the report, the following key points were raised:

 

·  The Board noted that at the end of December 2018, there were 1,475 appeals still outstanding from the 2010 valuation list.

·  Whilst acknowledging that no appeals had yet been registered in relation to the 2017 valuation list, Members were informed that it was still early days. 

·  The appeals process is now digitised and requires more evidence to be provided to justify claims for appeals to be submitted. As such, it was hoped that the change in the appeals process would help to reduce future levels of appeals being registered;

·  The Board acknowledged that outstanding appeals cause difficulties for the Council with regard to financial planning and that even though 9 appeals still remain outstanding from the 2005 valuation list, the Council was unable to move the VOA to a resolution quickly. Linked to this, it was noted that the VOA was also experiencing resource pressures.

·  The Board discussed the distinctions made between the collection of Business Rates and Council Tax as particular reference was made to levels of written-off debts during a downturn when it is not economical to collect money owed for business rates.

·  It was noted that when a business ceases to exist, the debt also ceases. Whilst acknowledging that Companies House can be used to gather information on Phoenix companies, Members expressed an interest to understand more about the rules surrounding Phoenix companies and the role of the Insolvency Agency.

·  Members were also informed that where a business goes into administration, they are usually up to date with their business rates and therefore there is usually no loss to the Council.

·  Clarity was provided to the Board in regard to Mandatory Charity Relief which is awarded to academies. Reference was also made to the ‘Mazaars Case’ and its impact on small business rates relief.

 

RESOLVED – To note the content of the report.

 

The Chair advised the Scrutiny Board that Doug Meeson was leaving the Council at the end of March and therefore thanked him for all his support and advice provided to the Scrutiny Board.  The Board also showed their appreciation with a round of applause.

 

Supporting documents: