Business Rates - Fair or Unfair

[singlecoil]

Wombat3 said:

Garbage, it stands absolutely.

Two businesses consuming the same amount of energy will pay the same amount of tax on that energy. They will pay the same rate of IPT on their insurance premiums.

They will charge their customers the same level of VAT & will pay the same levels of tax. Their employees will pay tax & national insurance at the same rates.

Meanwhile the same two businesses occupying the same amount of physical space will pay different levels of rates (tax) on that space.

Its inconsistent and stupid.

You need to think it through and take account of ALL the aspects. Your examples work against you when you do that. Of course two businesses using the same amount of energy will pay the same, because the VALUE of the energy is the same. But with premises where the value is in the location alone, then taxing that value is fair (if any tax can be called fair) and logical.

[Chrisgr31]

Wombat3 said:

Garbage, it stands absolutely.

Two businesses consuming the same amount of energy will pay the same amount of tax on that energy. They will pay the same rate of IPT on their insurance premiums.

They will charge their customers the same level of VAT & will pay the same levels of tax. Their employees will pay tax & national insurance at the same rates.

Meanwhile the same two businesses occupying the same amount of physical space will pay different levels of rates (tax) on that space.

Its inconsistent and stupid.

Of course quite a few business with shops in say Newcastle and Oxford Street would charge more for products sold in Oxford St. As an example the supermarkets charge different prices in their metro stores compared tot eh hypermarkets and I believe some do geographic pricing as well. Many will also pay staff in London more so VAT and staff get more.

Businesses broadly pay the same rate in the pound wherever they are based, with the rates varying according to rents.

[NDA]

An article in the Times today discusses this very fact. They examine a few cases, one of a landlord where his bill will go from £8,470 to £20,850 - an impossible increase for a small family-run pub. Another pub is facing a 516% increase which will put them out of business.

http://www.thetimes.co.uk/edition/news/pubs-under-...

[singlecoil]

NDA said:

An article in the Times today discusses this very fact. They examine a few cases, one of a landlord where his bill will go from £8,470 to £20,850 - an impossible increase for a small family-run pub. Another pub is facing a 516% increase which will put them out of business.

http://www.thetimes.co.uk/edition/news/pubs-under-...

Had a look but it's a subscription thing.

[singlecoil]

NDA said:

An article in the Times today discusses this very fact. They examine a few cases, one of a landlord where his bill will go from £8,470 to £20,850 - an impossible increase for a small family-run pub. Another pub is facing a 516% increase which will put them out of business.

http://www.thetimes.co.uk/edition/news/pubs-under-...

I can't read the rest of the article, but could see enough to identify and check out the first place you mention. Not really small, and it has three letting cottages as well as a restaurant with maybe 16 covers, plus an outdoor eating area. £400 a week is more than I would like to pay if I owned that business, but as for 'impossible', definitely not.

Business rates are a drag, just as much as any other tax, but I have yet to see a business fail or close down purely because of them and no other reason.

[fridaypassion]

NDA said:

An article in the Times today discusses this very fact. They examine a few cases, one of a landlord where his bill will go from £8,470 to £20,850 - an impossible increase for a small family-run pub. Another pub is facing a 516% increase which will put them out of business.

http://www.thetimes.co.uk/edition/news/pubs-under-...

But according to singlecoil this is all fine and should simply be priced.

Close the door on the way out chap.

[singlecoil]

fridaypassion said:

NDA said:

An article in the Times today discusses this very fact. They examine a few cases, one of a landlord where his bill will go from £8,470 to £20,850 - an impossible increase for a small family-run pub. Another pub is facing a 516% increase which will put them out of business.

http://www.thetimes.co.uk/edition/news/pubs-under-...

But according to singlecoil this is all fine and should simply be priced.

Close the door on the way out chap.

[singlecoil]

Anyone who is wondering why I am swimming against the tide on this subject is because blaming rates for the demise of businesses is misleading and a waste of time. It's confusing the issue and it's misdirection.

I am in business myself and I don't like paying rates any more than anyone else does, but any business that can't afford them is a business with other much more serious problems which need urgent attention.

[chippy348]

singlecoil said:

Anyone who is wondering why I am swimming against the tide on this subject is because blaming rates for the demise of businesses is misleading and a waste of time. It's confusing the issue and it's misdirection.

I am in business myself and I don't like paying rates any more than anyone else does, but any business that can't afford them is a business with other much more serious problems which need urgent attention.

I think you are going OT here

The Op asked are business rates fair / or the way they are worked out.

And the answers for me is no.

But sticking with your line of "rates should not hold back a business, if you can not afford them you should not be in business"

You say you are in business ? Do you indeed pay business rates on your premises / workshop?

I think i know the answer but let's assume that you pay say £7,200 a year in rates, and your business is doing just ok, not setting any records but just keeping you in a decent life style and paying all the bills, like most small business are.

Now in Aprili you are now going to have to find £14,400 for your business rates as you have been re-rated (like most have) that is an increase of £7,200

Nothing has changed in your building, you still have the same Sq footage but this £7,200 has got to come from somewhere, so if you can not find it as your business is now no longer viable what do you do ?

[fridaypassion]

In this example rates could be responsible for job loss there are more extreme examples too. just yesterday I had a guy in my work that had a 10k increase in rates on this re valuation. As I had previously correctly pointed out this is now holding back planned expansion. just as the rates system held me back when my business was in its infancy. There were no other big bills apart from rent.

One question singlecoil sidestepped was are you an entrepreneur? or did you daddy's business? either you are just being deliberately annoying on this thread or you have no concept of the battle it is to set up and expand a business successfully. saying that business rates are helpful for business is probably the most ridiculous thing I've heard on here since that guy that folded his back seats down to make his car go faster.

How much does a freelance kitchen designer working from home actually pay in rates?

[singlecoil]

First thing the pair of you need to do is to do is to stop trying to disqualify me from having a valid opinion on this subject. It's as daft as trying to disqualify a person with no legs from having a valid opinion of top-level football. In any case, I have paid business rates in the past and will again in the future. I have carefully analysed all the expenses and all the income streams of a number of businesses of different types over the years, especially recently, and can confidently say I have a wider knowledge of such matters than either of you who will be mostly concerned with your own businesses (as indeed you should be).

Secondly, the topic doesn't make sense. Taxes are neither fair nor unfair. There's no way of measuring the fairness of a tax because fairness doesn't come into it. It's a tax on business premises. The building is there, it can be seen, it has a certain value on the rental market whether it is actually rented or not and it's taxed accordingly. It's a good way of ensuring that businesses who otherwise managed to avoid a lot of UK tax by basing their headquarters in tax havens still pay something toward the Exchequer.

If you want me to comment on rates increases then I will want to know which premises are involved so I have all the info I need to make my own judgement on whether that's sustainable or not. For instance, the OP went very quiet when I pointed out that the hotel he talked about (but didn't name) must have been a very big one to be subject to that kind of rates, not the small family place it was portrayed as.

The pub featured more recently was named, and as I pointed out earlier the situation was not at all what was suggested in the article.

fridaypassion said:

saying that business rates are helpful for business is probably the most ridiculous thing I've heard on here since that guy that folded his back seats down to make his car go faster.

Good job I didn't say that then.

What I have been saying is that to blame business rates for business closures of failure to expand makes no more sense and bears no more close inspection than blaming the wrong make of shoes for failing to get off with the woman of your dreams.

So stop blaming rates for your business woes and get to work on the real causes.

[fridaypassion]

so in short you aren't an entrepreneur and you don't pay business rates.

I don't have busibess woes if you look at my profile we are the top indie in the UK at what we do.

[singlecoil]

fridaypassion said:

so in short you aren't an entrepreneur and you don't pay business rates.

More misrepresentation. Keep at it, you've convinced yourself at least.

[fridaypassion]

Maybe a business idea here for you. The production manufacturing and distribution of large shovels?

[singlecoil]

Here's a business idea for you, stop blaming rates and get on with running your business.

Alternatively, stop sidestepping the points I've raised and we can talk about the subject sensibly.

[chippy348]

singlecoil said:

First thing the pair of you need to do is to do is to stop trying to disqualify me from having a valid opinion on this subject.

I am not trying to disqualify your opinion but as a whole i don't agree with it, in a civilized world we can do this without throwing insults or waving your willy about.

singlecoil said:

If you want me to comment on rates increases then I will want to know which premises are involved so I have all the info I need to make my own judgement on whether that's sustainable or not. For instance, the OP went very quiet when I pointed out that the hotel he talked about (but didn't name) must have been a very big one to be subject to that kind of rates, not the small family place it was portrayed as.

But i have given you an example below ? yes the OP hotel may have been the Hilton in Glasgow but i am talking about small business owners in my example as well as the Pub in Ludlow in the Times link.


So a say it again

let's assume that you pay say £7,200 a year in rates, and your business is doing just ok, not setting any records but just keeping you in a decent life style and paying all the bills, like most small business are.

Now in Aprili you are now going to have to find £14,400 for your business rates as you have been re-rated (like most have) that is an increase of £7,200

Nothing has changed in your building, you still have the same Sq footage but this £7,200 has got to come from somewhere, so if you can not find it as your business is now no longer viable what do you do ?

[NDA]

Meanwhile, in other news, the British Retail Consortium warned that business rates could cause 80,000 shops to close in 2017. Appeals over business rates are now running at almost 500 per day....

Is it possible they're not fair?

[singlecoil]

chippy348 said:

singlecoil said:

First thing the pair of you need to do is to do is to stop trying to disqualify me from having a valid opinion on this subject.

I am not trying to disqualify your opinion but as a whole i don't agree with it, in a civilized world we can do this without throwing insults or waving your willy about.

Who has been throwing insults?

chippy348 said:

singlecoil said:

If you want me to comment on rates increases then I will want to know which premises are involved so I have all the info I need to make my own judgement on whether that's sustainable or not. For instance, the OP went very quiet when I pointed out that the hotel he talked about (but didn't name) must have been a very big one to be subject to that kind of rates, not the small family place it was portrayed as.

But i have given you an example below ? yes the OP hotel may have been the Hilton in Glasgow but i am talking about small business owners in my example as well as the Pub in Ludlow in the Times link.


So a say it again

let's assume that you pay say £7,200 a year in rates, and your business is doing just ok, not setting any records but just keeping you in a decent life style and paying all the bills, like most small business are.

Now in Aprili you are now going to have to find £14,400 for your business rates as you have been re-rated (like most have) that is an increase of £7,200

Nothing has changed in your building, you still have the same Sq footage but this £7,200 has got to come from somewhere, so if you can not find it as your business is now no longer viable what do you do ?

You are not providing enough information. What's the rent, the turnover, the G.P. the EBITDA, the staff costs? Why was the building re-assessed, was there an appeal? I need all of this stuff before I can answer your question as would anyone else (unless they were trying to make some kind of political point (and it would be a weak one without more info)).

[singlecoil]

NDA said:

Meanwhile, in other news, the British Retail Consortium warned that business rates could cause 80,000 shops to close in 2017. Appeals over business rates are now running at almost 500 per day....

Is it possible they're not fair?

I trust the appeals process is fair, and if it is then the appeals will be successful. Meanwhile, in other news, a trade body lobbied in support of its members' interests.

[foliedouce]

I haven't read the last 8 pages, but in short we're facing large rates increases across our 3 UK offices, in addition to that, our biggest client (the NHS) is cash strapped and has been playing hardball on pricing with eAuctions / race to the bottom etc, and we've taken a 15% hit on import prices due to Brexit, plus increased costs in autoenrollment, apprentership levy etc

None of those things are terminal, but they all add up and I can see how to some businesses this could be the straw that breaks the camel's back.

My local town has a variety of independent shops, 3 of which are now closing due to the new business rates. They were run by families that had other forms of income so they weren't businesses in the way singlecoil describes, but they were still adding a lot of value to the local area. The new rates means it's just not worth their while getting out of bed anymore, a real shame I'd say.