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DCLG to introduce business rates ‘check, challenge, appeal’ system

Councils will lose less income on unnecessary business rates appeals under a new system, the DCLG has promised.

The DCLG announced today that it is introducing a ‘check, challenge, appeal’ process, with three stages designed to check the facts are accurate and allow businesses to challenge the rateable value on which their bill is based, before going to an independent valuation tribunal as a last resort.

This is intended to make appeals quicker and more efficient, and reduce speculative appeals.

Following a period of consultation – where an overwhelming majority of respondents recognised the need for change – the government will now press ahead with streamlining the appeals system in England. The new process will come into effect in April 2017.

Greg Clark, the communities and local government secretary, said: “For too long we’ve had an appeals system where backlogged cases – often caused by unscrupulous agents eyeing up a fast buck – meant unnecessary costs and uncertainty for all involved.

“That’s why we are going ahead with our plans to streamline the process and help resolve cases as quickly and fairly as possible.

“The vast majority of disputes will now be settled long before lengthy litigation and will mean businesses and councils can get on with planning budgets, confident they are getting a fair deal.”

The Department said businesses will now go through a 3-stage process:

Check – ensuring the relevant facts are up to date and accurate, with any agreed errors quickly corrected. For the vast majority of ratepayers it is expected that this check stage will be complete in a matter of days.

Challenge – allowing the business to challenge the rateable value on which their business rates bill is based, giving them the opportunity to set out their grounds for challenging, an alternative valuation and to put forward supporting evidence - it is expected that the great majority of cases to be resolved by this point.

Appeal – offering the opportunity to appeal to an independent valuation tribunal.

The DCLG is also introducing an online service to allow rates payers to provide information about their property and check the process of their application and a £300 fee for appeals that will be refunded if the appeal is successful.

The business rates appeals system has cost councils £17.5bn in the past three years, and the District Councils Network has said the process should be ‘dramatically curtailed’.

Councils and MPs have warned that reforms to the business rates appeals system are particularly important ahead of government plans to fully devolve business rates to councils by 2020.

In response to a new government consultation on the proposals, the LGA said that reforms were “essential” to avoid exposing councils to financial risk, and the Communities and Local Government committee has said that many councils expressed concern about the issue during an inquiry.

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