INDUSTRY NEWS

Business rates on commercial property set to soar

Businesses will find themselves hit by heavy rate hikes when a new valuation system is implemented in 2010, a number of property experts have warned.

Property valuations for the purpose of rates calculations occur every five years, but the valuation is set in motion two years before the rate changes themselves.

This means that the rates due to be collected next year will actually be based on April 2008 property values. Although commercial property had begun to fall from its peak, the worst of the decline occurred after this time.

Properties in London’s West End will be hit hardest, with up to 50% increases, despite a fall of roughly 50% in property values. London as a whole will experience an average of 25% rate rises. The government has stated that it will still raise £5 million less in business revenues as a result of the revaluation.

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