New Clause 2 - Exemption of equestrian enterprises from non-domestic rating
Rating (Agricultural Premises and Rural Shops) Bill
12:45 pm
Mr James Gray (North Wiltshire, Conservative)
I beg to move, That the clause be read a Second time.
I shall speak more briefly than I normally would in such circumstances in the hope of currying favour with the other members of the Committee. I shall explain new clause 2 less thoroughly than I might otherwise do, despite the insult of being described as the duller end of the rainbow. My name may be duller, but I am sure that my hon. Friend the Member for Ashford would not wish to make any intellectual comparison. Certainly, if there were to be an intellectual comparison across the Floor—I will not go down that track.
The new clause was tabled for a sound reason. I should declare a non-pecuniary interest, which is that I am chairman of the Horse and Pony Taxation Committee and an unpaid consultant to the British Horse Industry Confederation. I therefore speak on behalf of horse businesses.
We support the Bill. It is important that farmers should be allowed to diversify in the way that is proposed, so we do not oppose the Bill. However, given that many farmers will diversify into horse businesses, the Bill will have an unfortunate effect on existing horse businesses. That particularly applies in the case of riding schools, which are already in severe decline. Since the Government came to power, riding schools have closed at the rate of 200 per annum. It looks as if that rate of decline is increasing rather than decreasing, and it has certainly been made worse by the foot and mouth disease crisis.
The purpose of the new clause is to correct an anomaly that was last addressed by the House in 1987, when the other place decided not to proceed with the matter. It is a peculiar anomaly that premises used for housing horses used for agricultural purposes—heavy horses in particular—and stud farms, are given business rate relief. However, if one uses precisely the same barn as was used last week for housing a heavy horse to house a horse that one intends to rent out for pony trekking, or which will be used in a riding school business, one does not receive rate relief. That is a curiosity that ought to be corrected. This may not be the right Bill in which to do that, but it could become the right Bill when one considers that, if it is enacted, a farm that diversifies into a riding school business will receive 50 per cent. rate relief, whereas an existing riding school will receive no rate relief at all. That introduces a peculiar form of competition between new and existing businesses.
The new clause corrects both of those anomalies at a stroke by simply describing all horse businesses as agricultural, and from that point of view it is more effective than another amendments that was not selected for discussion today. That would mean that a horse business, whether a pony trekking business, a DIY livery yard or a riding school, would be described as agricultural and would benefit from the zero rate that other farming industries enjoy. That would be the cleanest possible way both of avoiding the unfortunate competition issue and of clearing up the existing anomalies in the agricultural exemptions.