CBI REACTION TO REJECTION OF AMENDMENTS ON BUSINESS RATES BILL
MISGUIDED VOTE WILL DAMAGE REGIONAL ECONOMIES
The CBI today (Wednesday) criticised the rejection by MPs of amendments to the Business Rates Supplements Bill, which would have helped regional economies across the UK.
The Business Rates Supplements Bill will allow local authorities to levy supplementary taxes on companies to pay for infrastructure projects which benefit local economies. The taxes could total £800m a year, according to the Lyons Review into Local Government of March 2007.*
The CBI has campaigned for amendments to the Bill. It says firms should get a vote to approve or reject proposed tax supplements to pay for new infrastructure projects. This would help ensure that extra tax is only levied for projects that make economic sense, and help avoid misguided levies that could hurt companies at critical times.
The amendments rejected today were introduced in, and supported by, the House of Lords. They would have introduced such a vote, and benefited the UK economy as a result. But they were not backed by the Government, and today the House of Commons voted against them.
John Cridland, CBI Deputy Director-General, said:
“The rejection of these amendments pokes a finger in the eye of British business at a difficult time.
“We had called for sensible changes that would have ensured more effective local government spending. They would have helped avoid unnecessary, misguided tax supplements that could lead to further job losses.
“The House of Lords weighed the evidence, and reached the view that these amendments tabled by opposition parties were in the national interest. In contrast, the Government has ignored these arguments, leading to today’s misguided vote.”
17 June, 2009
Notes to Editors:*As currently worded the Bill will enable a 2p supplement to levied on non-domestic rate-payers, which is the equivalent of a 4% increase in rate bills. Were this to be applied throughout England then it would raise £800m for local authorities, according to Sir Michael Lyons’s Review into Local Government – Final report (March, 2007). This assumes, however that there is no £50k rateable value condition. The figure is likely to be an underestimate because more properties will be valued above £50k following the 2010 revaluation of non-domestic properties.
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