Government rejects business rates spending plan

The Government has rejected plans to let businesses vote on how proposed extra business rates will be spent.

The Business Rates Supplement Bill will allow large city or unitary councils to levy extra taxes to pay for local infrastructure projects. More than 6,000 licensees will have to pay an extra £1,000 in business rates under current plans.

The Government ignored suggestions from the House of Lords that would have allowed businesses to vote on how their money was spent — leading to criticism from the Confederation of British Industry.

The CBI says the amendments would have helped regional economies.

It campaigned for amendments to allow firms to vote on whether to accept proposed supplements on individual projects. It said this would help ensure extra tax is only applied for projects that make economic sense.

The rejected amendments were introduced by the House of Lords, but were not backed by the Government, and the House of Commons voted against them.

John Cridland, CBI deputy director-general, said: "The rejection of these amendments pokes a finger in the eye of British business at a difficult time. We called for sensible changes that would have ensured more effective local Government spending. They would have helped avoid unnecessary, misguided tax supplements that could lead to further job losses.

"The House of Lords weighed the evidence, and reached the view that these amendments tabled by opposition parties were in the national interest. In contrast, the Government has ignored these arguments, leading to this misguided vote."