Non-Domestic Rating (Lists) (No. 2) Bill: Briefing for Lords Stages

The Non-Domestic Rating (Lists) (No. 2) Bill has one substantive clause. It would postpone the next revaluation for business rates in England and Wales by a year to 1 April 2023.

The bill replaces a similar bill the Government introduced in the Lords earlier in the current parliamentary session, the Non-Domestic Rating (Lists) Bill. That bill would have brought the revaluation forward a year to 1 April 2021 from 1 April 2022. However, that bill has not progressed due to the Covid-19 pandemic. Instead, by delaying the revaluation, the Government has said it aims to help firms affected by the pandemic.

In the UK, all non-domestic properties pay rates known as ‘business rates’ unless subject to an exemption. The administration of such rates is devolved to Scotland, Wales and Northern Ireland.

A property’s business rates bill is determined by multiplying its ‘rateable value’, which is its estimated open market rental value on a set date, by a national ‘multiplier’. In England and Wales, the Valuation Office Agency (VOA) sets rateable values independently of government and these appear on non-domestic rating lists. The UK Government sets the national multiplier in England and the Welsh Government does so in Wales. These values are then used to calculate bills.

A process called revaluation regularly takes place to help ensure that rateable values reflect changes in the property market. This sees the rateable values of all business and other non-domestic property in England reviewed by the VOA at specified intervals. Currently, revaluation is scheduled to take place every five years from 1 April 2017 and would therefore next take place on 1 April 2022. The bill would reset the next revaluation to 1 April 2023 to take account of the coronavirus pandemic.