Councils lobby for return of tax relief on empty properties

Councils have universally backed the commercial property industry's campaign for the restoration of tax relief on empty buildings.

The campaign, led by the British Property Federation (BPF) and trade magazine Property Week, calls for the £1bn tax, introduced in April this year, to be scrapped in tomorrow's pre-Budget report. Previously, tax relief was granted as companies were not getting rent from buildings that stood idle.

A survey, by commercial property adviser Atisreal, of 400 councils which collect the tax showed all were opposed to the legislation. More than 60 per cent said the number of court summonses for non-repayment of business rates had increased as a result.

While firms in Birmingham, for example, are liable for £23m for empty properties, the council itself must cough up £817,000 for unused public buildings. There are fears that civic buildings throughout the country may be knocked down to avoid payment.

Birmingham council leader Mike Whitby said: "The Government's current 'tax now, ask questions later' policy is threatening growth and suffocating vital new developments."

Companies supporting the campaign include the property giant Land Securities and McDonald's.