Rates bill for vacant premises costing taxpayer £690m-per-year (From Bradford Telegraph and Argus)

Rates bill for vacant premises costing taxpayer £690m-per-year

11:32am Monday 2nd February 2009 in

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The Government’s decision to charge rates on empty commercial properties is costing taxpayers £690m a year as a result of the bill for local authority-owned buildings, according to the Business Centre Association, which represents owners of business parks.

From information obtained under the Freedom of Information Act, it says more than 320 local authorities and regional development agencies are paying the additional tax which could threaten investment in regeneration schemes.

Since last April, Bradford Council has paid nearly £135,000 in rates on 49 empty buildings, including 19 in the city centre.

The Government imposed the charge “to provide strong incentives to bring vacant premises back into use.” This saw empty warehouses rateable for the first time after standing empty for six months and shops and offices rateable after three months unoccupied.

The move caused an outcry from businesses and the property sector as the new charge coincided with the economic downturn.

Bradford Chamber of Commerce, which represents 1,100 local businesses, has been lobbying hard for a rethink.

Mike Cartwright, policy executive, said: “Now is precisely the time to bring back empty property rate relief. The property market, like other areas of the economy, is facing tough times and imposing an extra cost on owners and developers is not the right way forward. We will continue lobbying.”

Business Secretary Lord Mandelson caused outrage when he said empty property rates would force down rents and were good news.

It has been claimed the charge would lead to “bombsite Britain” as some property owners demolished empty buildings to avoid paying the rates.

Following protests, Chancellor, Alistair Darling amended the rules to exempt empty buildings with a rateable value of less than £15,000 from the charge for the 2009-10 financial year. This will benefit Bradford.

Coun Mohammed Masood, Bradford Council’s executive member for corporate, said: “A change in legislation from April 1 will see us having to pay rates on just three empty properties, which will reduce the amount we have to pay to £36,253.

“We are not considering demolishing any empty buildings.”