Business Rates

Part of Delegated Legislation – in the House of Commons at 4:46 pm on 2nd April 2019.

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Photo of Geoffrey Clifton-Brown Geoffrey Clifton-Brown Conservative, The Cotswolds 4:46 pm, 2nd April 2019

I will get a little further in my speech and then accept a few more interventions. If I can make some progress, hon. Members might see where I am coming from.

The Red Book says that the amount collected by the business rates in 2019 is about £30.9 billion, but even this simple proposition is clouded by how much the Government have to provide for a loss on appeals, which alters the uniform business rates multiplier to allow rates under legislation to rise by at least RPI every year. Whatever happens to appeals, rates or reliefs, the Minister and his Department have to make up that £30.9 billion elsewhere.

I come now to the kernel of what I want to say today, and this in part addresses the interventions from hon. Friends. The OECD revenue statistics database makes it perfectly clear that the UK tops the league of taxation on immovable property both as a percentage of taxation and as a percentage of GDP by some margin. The UK paid 9% of rateable taxation in 2016. Our nearest rival, France, paid 7%; Germany just 1%; and Luxembourg barely a quarter. This must be a major reason why manufacturing business is not as competitive as in our nearest European rivals.

To shore up this £30.9 billion of revenue, the Treasury has had to increase the complex array of reliefs and allowances to compensate for some of the most damaging consequences of the tax, so in every Budget more or less, one sees a new allowance or relief to mitigate some of the worst effects of the tax. As Rachael Maskell has already done, I refer the House to my previous debate on this subject on 9 October 2018, when, as reported at column 117, my right hon. Friend the Minister listed some of these many reliefs.

We were all pleased when, in his Budget on 29 October last year, the Chancellor recognised that many small retail businesses were struggling to cope. I am sure that Members throughout the Chamber can give examples of businesses that are struggling to cope with the high fixed costs of business rates.