Autumn Budget: Business Rates Boost for SMEs - Fleximize

Autumn Budget: Business Rates Boost for SMEs

Philip Hammond reveals package of measures that should ease the business rates burden on the UK's smallest companies

22nd November 2017

By Adam Pescod

Ahead of the Autumn Budget, Fleximize conducted a survey of business owners, asking them what they’d like to hear from Philip Hammond when he delivers his spending plan for the coming year. Chief among their concerns was a looming rise in business rates which, if implemented, would put the future of their businesses in serious doubt. Several business organizations also raised the issue with the chancellor ahead of his budget speech – and it’s safe to say he listened.

Despite some gloomy growth forecasts and questionable attempts at humour, Hammond delivered some positive news to small businesses by announcing that, from April 2018, business rate rises would be pegged to the CPI (Consumer Price Index) measure of inflation instead of the RPI (Retail Price Index), saving companies a total of £2.3 billion. "We can't build an economy fit for the future without helping the backbone, our small businesses,” said the chancellor.

The good news didn’t end there, however. Hammond went on to confirm that any businesses affected by the so-called ‘staircase tax’ would have their original bill reinstated, adding that the business rates discount for pubs with a rateable value of £100,000 would be extended by another year. He also announced that, following the next rates revaluation, future revaluations will take place every three years rather than five, which will reduce the size of increases going forward.

While the headline announcement of Hammond’s Budget was the scrapping of stamp duty for first-time buyers, there was plenty else that will be of interest to business owners. Here’s a summary:

“I applaud the chancellor for listening to the CBI, British Chambers of Commerce and other organisations, whose recommendations on business rates were made with the interests of small businesses in mind,” said Peter Tuvey, co-founder and managing partner of Fleximize, the alternative business lender.

“In our recent survey of business owners, 34% said business rate rises are one of the biggest issues affecting their business, with 40% saying a cap on rates would make the most difference to their company. These measures, along with the maintenance of the VAT threshold, should allow thousands of small businesses to thrive, which can only be good news for the UK economy.”

Full information on the Autumn Budget is available on the government’s website, including a full transcript of Philip Hammond’s speech.

Photo credit: Raul Mee (via Flickr)