Abolish business rates. I realise that in the current climate the government could not possibly afford such a generous tax cut, so I propose making up for the lost tax revenue by increasing corporation tax by whatever amount would make the whole thing revenue neutral.

Why is this idea important?

Business rates add an extra layer of complexity to an already overcomplicated tax system. They are also unfair, as they vary in arbitrary ways from one property to another. They no doubt also adversely affect the commercial property market, which is probably not a good thing in the current climate.

Their enforcement is also extremely heavy-handed and vindictive.

Putting the equivalent taxation onto corporation tax would also mean that the taxes would only be paid by companies who are making money. In the current system, a company having a bad year might find that their business rates could make the difference between survival and failure.

It would also save huge amounts of bureaucracy. Business have to pay corporation tax anyway, so increasing the rate would add zero extra administrative burden. Scrapping all the bureaucracy behind business rate valuation, collection, enforcement etc, would save a fortune.

10 Replies to “Abolish business rates”

  1. I totally agree! This year I have seen my business rates rise due to new valuations and now I am no longer eligeble for small business rate relief even though I’m still a small business and my turnover has dropped considerably. Also the calculations are very unfair. I have a workshop at the rear of my shop that the public are not allowed to enter, and is seprated by a wall and a door. But, as it is not a solid wall I have to pay £137 square meter instead of £37.50 spuare meter for a workshop. Toatlly unfair.

  2. I totally agree.
    Abolishing business rates would:-
    Reduce the overheads businesses.
    Encourage many new businesses and businesses run from home to expand into premises or move to larger premises. This would reduce the number of empty businesses on the high street. Increase business activity and profitability. This in turn would increase revenues from corporation tax and VAT. It would give value to business properties without the liability of rates. Businesses could then could borrow against the strength of a more valuable property asset. Empty bussiness properties would get needed investment to bring them back into use, creating work for all sorts of trades.
    Why are we taxing buildings which created employment and wealth for the country. I would be happy to pay a local business tax based on the profit of a business (nobody minds paying their way if they are making profits), but rates are big taxes on borderline businesses and causing many to close

  3. Business rates should be abolished and replaced with a property tax (the same with council tax too), which would would be levied on the owners of commercial and residential property (as well as land with planning permission). This would bring the UK into line with literally every other OECD country. Landowners and landlords are not engaged in productive economic activity (unlike this country’s hardworking high street businesses), and as property taxes based on ownership encourage an increase in the supply of property (by making property a less attractive investment) the tax cannot be passed on to businesses/tenants (i.e. rent yields would fall be a greater amount than the tax liability). The real enemy of our businesses are landlords, who will use propaganda to deceive people into believing rents would simply go up, which is an outright lie which anyone with a basic understanding of Henry George’s arguments (and the OECD’s chief economist) would understand.

  4. I recently wrote to the government with exactly the same idea to abolish business rates and raise corporation tax. This would ensure that those who can afford to pay through profit pay and those who currently don’t make profit potentially down to thousands of pounds of business rates would make a profit & pay tax on that profit.
    Business rates is a terrible tax. It only applies to businesses run in premises so multi million pound corporation run from a laptop in a coffee shop(that is paying business rates) does not pay them. It is also unfair as it is based on size not turnover therefore a low turnover business in a larger space pays more business rates. Charities do not pay business rates & get reduced rent or no rent deals so a lot of high streets are full of charity shops & empty shops as new business cannot afford the rates. If business rates were abolished I could afford higher wages for my team putting more back into economy as could a lot of small businesses. I want to create a petition for this and get it changed but finding it hard to get off the ground! Government are currently reviewing a small lowering of business rates & corporation tax so where will the money then come from. If my business was mobile I would not pay business rates. Why should I be taxed just for being in a building. As a business we do not get community facilities paid for these are all additional such as bins, drains etc. business rates needs abolishing.

  5. Business rates should certainly be abolished. They are an absurd, irrational and unfair way of taxing businesses. I have personally known people driven out of business because of high rates unrelated to their small income. Tax, related to turnover or profit is the only rational way to take revenue from businesses.

  6. Agree with all of above
    They are outrageous in U.K.
    Obstacle to business
    Landlords rents and council rates are restricting uk businesd

  7. Don’t reform buisiness rates just abolish in 2017 budget. I live in West Riding of Yorkshire and have witnessed banks, pubs, shops, Doncaster post office , Village post offices all closing their doors with this idiotic tax . When a local shop closes do the Doncaster rating department crack open the champagne and dance around their computers. We had the best sports shops in the land in Mexborough and Doncaster (inter sport) all gone now. Get some backbone Mrs May and dump this archaic tax into the dustbin where it belongs. If Rates were abolished it would unleash a tidal wave of much needed enteprenerial energy into this once proud area.

  8. Abolish business rates and replace it with a profits tax so that the likes of the big superstores pay a fair share in relation to the small town centre shops.

  9. Very good idea.

    See, it’s not just about ‘Tax’, and saving bureaucracy.

    I run a business, that uses a lot of space. Yet it makes so little profit per square foot.. With land prices spiralling upwards, I was lucky enough to even get a site.
    What I do it price set internationally, and uses a lot of space, full stop.
    I’d love to expand my undercover space, but every single square foot I add, makes my business less and less attractive. Not through the cost of expansion, but the rates hikes.
    If rates were abolished, I would right away, build a new building, about three times the size. I could work better, employ more people, and (most importantly) in a bad year, still pay the bills.

    Abolishing business rates would be one of the biggest boosts for cottage businesses in the past 50 years.

  10. Obviously. Business rates exist so that the NWO government can leach off the people.

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