Recommendation 46

HM Government Rejected

Business rates multipliers are set nationally. In a revaluation year, such as 2026, the VOA updates the rateable value of business properties to reflect changes in the property market. At revaluation, the multipliers are also recalculated according to a formula set down in law, to offset the change in rateable values, providing funding certainty to local government. In between revaluations, the multipliers increase by inflation, unless the government chooses to intervene. The Government cannot over index the standard or small business multipliers at any point. Local authorities already have far ranging powers to provide local business rates reliefs, which can be used having regard to their local council taxpayers. The Business Rates Supplement Act 2009 also provides for county councils, district councils in areas where there is no county council and the majority of Mayors to levy a supplement on the national rate, subject to consultation and holding a ballot. The City of London can also set a premium on top of the business rates multiplier and retain the proceeds, these arrangements reflect their very limited ability to raise revenue from council tax. The Government must balance providing further devolution of powers to set rating policy locally with certainty and simplicity for ratepayers nationally. All tax policy is kept under review.