pounds 30m tax break for Harrods
Sunday 05 September 1999
Businesses in booming parts of Britain, such as Knightsbridge, could face increased tax bills of more than pounds 1bn a year unless the proposals are approved next month. But experts are already criticising the scheme, saying firms in deprived areas will miss out.
The savings will come from an extension to the "transitional phasing" on business rate bills. In 1990, when the Tory government introduced a national business rate, the ratable value for some business properties rocketed, with Harrods going from pounds 900,000 to pounds 13m. To compensate, the government capped annual business rate increases, and decreases, at an average 10 per cent. Since ratable values in some areas have risen faster than that, some businesses are still not paying the full amount.
The scheme was to end next year, but ministers have asked officials to draw up options with a view to extending it.
The distortions are highlighted by figures obtained by The Independent on Sunday. These reveal Harrods' saving pounds 30m since 1990. It will save millions more if phasing is extended beyond 2000, as will pub chains, cinema operators and out-of-town retailers.
The losers will be companies located in places where values have fallen. These include industrial complexes, town centres hammered by out-of-town malls, and areas receiving grant aid such as rural Wales and former mining communities, said Paul Danks, head of rating at Fuller Peiser, a chartered surveyor. Without phasing, they would get significant cuts in their rate bills.
"Transition artificially distorts the tax system," said Charles Partridge, head of rating at the Royal Institution of Chartered Surveyors. "It benefits those most able to afford to pay more while penalising those who can't."
The Local Government minister, Hilary Armstrong, has asked officials to map out options to extend transitional phasing of business rates, bills but the Treasury is understood to be reluctant to fund all of the relief.
- 1 Keira Knightley topless: Conservative actress does own take on #Freethenipple campaign for Interview Magazine
- 2 Argentina may change its capital city from Buenos Aires, says president
- 3 Joan Rivers: 'Palestinians deserve to be dead'
- 4 The 3D-printed key that can unlock anything
- 5 Lady al-Qa’ida: On the trail of Dr Aafia Siddiqui, the world’s most wanted prisoner
Keira Knightley topless: Conservative actress does own take on #Freethenipple campaign for Interview Magazine
YouTube video posted by Isis militants shows 'execution of 250 Syrian soldiers'
Oil tanker with $100 million cargo goes missing off Texas coast
Joan Rivers: 'Palestinians deserve to be dead'
Sir Paul McCartney makes his stance on Scottish independence known
Robin Williams Emmys tribute led by Billy Crystal criticised for including 'racist' joke about Muslim woman
The Rotherham child abuse scandal is a tale of apologists, misogyny and double standards
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Scottish independence TV debate: Pumped-up Alex Salmond bounces back in bruising second round against Alistair Darling
Do you realise just how foolish the UK looks?
With Douglas Carswell joining Ukip, my party has taken another giant step forward
- < Previous
- Next >
iJobs Money & Business
Highly Attractive Salary: Austen Lloyd: BRISTOL - This is a very unusual law c...
£35000 per annum: Harrington Starr: Network Engineer (CCNP, CCNA, Linux, OSPF,...
£50000 per annum: Harrington Starr: DevOps Engineer (Systems Administration, L...
£60000 - £70000 per annum: Harrington Starr: A prestigious leading professiona...