Tax

Budget 2017: Paul Dossett - Impact of business rates for local authorities

Expert commentary from Paul Dossett, head of local government at Grant Thornton UK LLP, on impact of business rates announcements in budget for local authorities:

“Unsurprisingly the Chancellor bowed to the pressure being piled on in the run up to today’s announcement to relieve the impact of business rate revaluations. A further £300mn has been announced to offer discretionary relief for those local authorities which will be particularly hard hit. Many authorities have held off on issuing their business rate bills for 2017/18, in the hope that they would receive more clarity today, so it is disappointing that there has not been further details provided for local government. Holding off on issuing business rate bills will have a direct impact on council’s cash flow.  

“With local government funding announced to be cut from £8.2bn last year to £5.5bn next year and essential services already in crisis, income generation is going to need to become an even greater priority to secure council’s financial sustainability. Our research shows that many authorities are already moving in this direction, with English local authority service income increasing by 4.1.% between 2013/14 – 2015/16. Income generation is an essential part of the solution to providing sustainable local services, alongside managing demand reduction and cost efficiency of service delivery. Therefore further clarity for local authorities on business rates is essential.”