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31.03.16

Clark confirms councils to receive full compensation for business rates cuts

Greg Clark, the secretary for communities and local government, has confirmed that councils will receive “compensation in full” for business rates cuts revealed in the most recent Budget.

In response to a letter from Clive Betts MP, chair of the Communities and Local Government Committee (CLGC), Clark said that councils will receive compensation paid by section 31 grants, and calculated on the basis of the returns that councils make under the rates retention scheme.

Prior to writing his response, Clark had said in a recent House of Commons question session that he didn’t know how much councils will receive.

He says in the letter: “Local authorities will be compensated in full for their loss of income as a result of these changes. We have compensated authorities in full for every reduction to business rates we have made since the introduction of the business rates retention scheme.”

He also says that there will be a consultation on the devolution of full business rates retention to councils this summer.

The CLGC are also holding an inquiry into the business rates proposals.

To read Clark’s letter, click here.

(Image c. Dominic Lipinski from PA Wire)

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