Business Rate Supplements Bill
10:38 am
Jane Milne: The problem with rateable value is that it is, in effect, an input tax. It does not try to match contributions to the benefits that will be derived from a given project, so there is no proportionment between different sectors of the economy. Because retail is a property-intensive sector and retailers have relatively little choice in which properties they occupy—they need to be in the high-access, high-footfall areas like the high street or certain retail parks—we have historically seen rents and property values, and hence rateable values, move up much more sharply for retailers than for office accommodation or other parts of business. Therefore, as Tom said, not only do we pay 25 per cent. of the overall rates bill, while actually generating 8 per cent. of GDP by value—we are paying three times our overall output—but that is likely to increase rather than decrease in future, so we see the burden falling increasingly heavily on us. In some respects it is the modern equivalent of a hearth tax or a window tax; it is not actually about the overall prosperity of different sectors in the community.