Chancellor announces £1.5 billion business rates relief pot

An additional £1.5bn funding pot for businesses outside of the retail, hospitality and leisure sectors has been announced on 25 March. The support will be available for businesses who do not already benefit from the existing £16bn business rates relief, and have been impacted by COVID-19 while continuing to pay business rates throughout the pandemic.

This comes in response to a growing number of appeals for discounts on business rates bills under the MCC (Material Change in Circumstance) system, which the government has now ruled out on the basis that market-wide economic changes to property values, including from COVID-19, can only be considered at revaluations.

The funding will be distributed to Local Authorities (LAs) according to official data on the economic impact of the pandemic on different sectors, as opposed to the impact on property values. The award will be made by LAs on a discretionary basis and targeted to businesses most in need based on their on-the-ground understanding of local businesses and their local economies.

While the measure rules out business rates refunds for all ratepayers who have been unable to use their properties at full capacity since the start of the pandemic, the measure promises to support the businesses outside of the retail, hospitality and leisure sectors that have been most affected by the pandemic in a fair and proportionate way.