‘BHA has been seeking clarification from Scottish Government about the detail of the cap on rates increases for 2017 / 2018. It is now clear that the Finance Secretary announced a cap of 12.5% in real terms before the application of an inflationary element. This means that the actual cash cap on rates increases will be 14.75%. It is unfortunate that this was not communicated at the time the announcement of the cap was made. It is, apparently, normal practice for inflation (RPI) to be applied at revaluation as it can be to rate poundages on an annual basis. BHA still believes that the capped relief, although applicable for one year only, represents a considerable benefit to businesses when compared to the significant increases in rateable values which arose at revaluation.
It has also become clear that businesses have formally to apply to their local authority to claim the capped relief. Some local authorities have already placed application forms on their websites and it is understood that Scottish Government is preparing a template application for use by councils. BHA members are advised to check their council website or make direct contact with council finance departments to confirm the application process. Businesses are also advised to lodge applications promptly as there is a liability to pay rates at the revalued level until the application for capped relief is processed. Businesses should appeal rates valuations if these are considered to be unjustified – the deadline for submitting appeals is 30 September 2017.
BHA will continue to engage with Scottish Government and the Barclay Review of Business Rates with the aim of securing a permanent, transparent and affordable approach to the valuation of hospitality businesses.’