Shock pub business rates rise

Evidence of shocking business rates hikes has emerged, with some licensees set to see bills more than double from next April.

The news follows stark warnings from the Conservatives that pubs would receive "bombshell" bills under new rates revaluations.

A snap survey on the Morning Advertiser's website found 21.7% of licensees said their rateable value had more than doubled. Nearly one third — 30.4% — said it had risen between 41% and 100%. However, 13% said it had stayed the same, while 8.6% saw it fall by up to 40%.

Geoff Holland of the Holly Bush at Salt, Staffordshire, said his rateable value has increased 114%, from £19,885 to £42,680.

He said he had increased his turnover, and called the "punitive" hike a "personal tax", which penalised success. "I would have to lay off two full-timers or put my prices up to be able to afford my business rates."

Another unnamed licensee doubled his turnover and said his rateable value had jumped by 142%, from £22,650 to £54,750.

He currently pays £9,800 per year. He has been told by consultants that due to transitional relief, he could expect to pay £12,300 in year one, £14,800 in year two, £18,100 in year three, £23,100 in year four and £24,800 in year five.

He called the increase "horrendous", adding he would consider whether to renew his tenancy.

John Chadwick, freeholder at the Arkwright Arms in Chesterfield, Derbyshire, said his rateable value has doubled from £19,250 to £38,500.

Turnover has only marginally increased and he hasn't made any other changes to the business. "We haven't increased our prices for 18 months, but if this isn't resolved, I'll have to impose severe price increases."

Rating expert and trade accountant David Jones branded business rates an "unscientific tax".

He said: "You can never find out how they do it. We know what VAT and capital allowances are, and we know business rates are 70% based on turnover, but it's an absolute nightmare, a most unfair tax."

Business rates are assessed according to the rental value of a property, which is affected by trading levels.

Levels are recalculated every five years, and new bills will be mailed out in April 2010. Pubs were revalued in April 2008, and the latest rateable values for pubs are available now online. Copies will arrive from the Valuation Office Agency this month.

Visit www.voa.gov.uk/2010 to see the new rateable values.