Business Rate Supplements Bill

House of Commons

Session 2008 - 09
Internet Publications
Other Bills before Parliament

Business Rate Supplements Bill

Business Rate Supplements Bill
1

A
Bill
To
confer power on the Greater London Authority and certain local authorities
to impose a levy on non-domestic ratepayers to raise money for expenditure
on projects expected to promote economic development; and for connected
purposes.
Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and
consent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—
Power to impose business rate supplements
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Power to impose a BRS
(1)
A levying authority has power to impose a levy, to be called a “business rate
supplement” (referred to in this Act as a “BRS”), on non-domestic ratepayers in
its area.
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(2)
The purpose of imposing a BRS is to raise money for expenditure on a project
that the authority is satisfied will promote economic development in its area.
(3)
A person is a “non-domestic ratepayer” in the area of a levying authority if the
person is, as regards a hereditament in the authority’s area, subject to a non-
domestic rate under—
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(a)
section 43 of the 1988 Act (occupiers of properties), or
(b)
section 45 of that Act (owners of empty properties).
(4)
“The 1988 Act” means the Local Government Finance Act 1988 (c. 41).
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Levying authorities
(1)
In this Act, “levying authority” means—
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(a)
the Greater London Authority;
(b)
a county council in England;
(c)
a district council for an area in England for which there is no county
council;
(d)
a county council or county borough council in Wales.
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(2)
The power conferred on a levying authority by section 1(1) may be exercised
jointly with one or more other levying authorities.
(3)
Where two or more levying authorities are acting jointly by virtue of this
section, a reference in this Act to a levying authority is (except where there is
contrary provision) to be read as a reference to those authorities acting jointly.
5
3
Use of money raised by a BRS
(1)
A levying authority must secure that the sums it receives in respect of a BRS
are used only for expenditure—
(a)
on the project to which the BRS relates, and
(b)
that the authority would not have incurred had it not imposed the BRS.
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(2)
A levying authority may use sums it receives in respect of a BRS to make
payments in respect of money loaned for the purpose of providing funding for
the project to which the BRS relates.
(3)
A levying authority must not use sums it receives in respect of a BRS to
provide—
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(a)
housing;
(b)
social services;
(c)
education services;
(d)
services for children;
(e)
health services;
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(f)
services that the authority provides in the discharge of functions
imposed by or under the Planning Acts (as defined by the Town and
Country Planning Act 1990 (c. 8)).
(4)
Regulations may amend subsection (3) so as to add, vary or omit a reference to
a matter.
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(5)
The Greater London Authority may make arrangements with a functional
body for some or all of the sums that the Greater London Authority receives in
respect of a BRS imposed by it to be used by the body for expenditure on the
project to which the BRS relates.
(6)
A reference to sums that a levying authority receives in respect of a BRS
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includes a reference to financial contributions made to it for the purpose of
enabling the project to which the BRS relates to be carried out.
(7)
The reference in subsection (6) to financial contributions made to a levying
authority includes, where the levying authority is not a billing authority,
financial contributions—
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(a)
made for the purpose specified in subsection (6) to a billing authority
which is a lower-tier authority in relation to the levying authority, and
(b)
transferred to the levying authority.
(8)
A lower-tier authority is—
(a)
in relation to the Greater London Authority—
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(i)
a London borough council, or
(ii)
the Common Council of the City of London in its capacity as a
local authority;
(b)
in relation to a county council in England, a district council whose area
forms part of the county council’s area.
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(9)
Where the Greater London Authority makes arrangements under subsection
(5) with a functional body, this section applies to the body’s use of sums that it
receives in respect of the BRS as it applies to the Authority’s use of sums that
the Authority receives in respect of the BRS.
(10)
A reference to sums that a functional body receives in respect of a BRS is a
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reference to—
(a)
sums that the Greater London Authority transfers to the body for the
purposes of arrangements under subsection (5) that relate to the BRS,
and
(b)
financial contributions made to the body for the purpose specified in
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subsection (6).
(11)
In subsection (1)(b) as it is applied to a functional body by virtue of subsection
(9), the reference to expenditure of the levying authority is to be read as a
reference to expenditure of the functional body.
Involvement of ratepayers, etc.
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4
Conditions for imposing a BRS
A levying authority may not impose a BRS unless—
(a)
it has published a document that sets out the proposal for the
imposition of the BRS (an “initial prospectus”),
(b)
it has consulted the relevant persons on the proposal,
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(c)
where there is to be a ballot on the imposition of the BRS, the ballot has
been held and the imposition of the BRS approved, and
(d)
it has published a document that sets out the arrangements for the
imposition of the BRS (a “final prospectus”).
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Prospectus
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(1)
Any initial or final prospectus must include the information specified in
Schedule 1 (and may include such other information as the levying authority
thinks appropriate).
(2)
The function of the levying authority of approving a final prospectus before
publication is a function that must be discharged only by the whole authority;
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but that does not apply in the case of the Greater London Authority.
(3)
After publishing an initial or final prospectus, a levying authority must—
(a)
place an electronic copy of the published prospectus on its website, and
(b)
make copies of the published prospectus available for inspection at its
principal office at all reasonable times of the day.
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(4)
In a case where two or more levying authorities are acting jointly by virtue of
section 2, each authority must separately—
(a)
discharge the function of approving a final prospectus before
publication, and
(b)
comply with the duty imposed by subsection (3).
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(5)
Regulations may amend Schedule 1 so as to add, vary or omit a description of
information.

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Consultation
(1)
The relevant persons for the purposes of consultation on the proposal in an
initial prospectus are—
(a)
each person who will be liable to pay the BRS;
(b)
each lower-tier authority in relation to the levying authority;
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(c)
such other persons as the levying authority thinks appropriate.
(2)
A person is to be regarded for the purposes of subsection (1)(a) as a person who
will be liable to pay a BRS if the levying authority thinks that the person will
be liable to pay a chargeable amount for the first day of the chargeable period
of the BRS.
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(3)
A person is also to be regarded for the purposes of subsection (1)(a) as a person
who will be liable to pay a BRS if the levying authority thinks that the person
would, but for section 13(7) or (8), be liable to pay a chargeable amount for the
first day of the chargeable period of the BRS.
(4)
A person is also to be regarded for the purposes of subsection (1)(a) as a person
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who will be liable to pay a BRS if the levying authority thinks that the person—
(a)
would, but for section 15 or 16, be liable to pay a chargeable amount for
the first day of the chargeable period of the BRS, and
(b)
will be liable to pay a chargeable amount before the end of that period.
(5)
For the purposes of subsection (1)(c), a levying authority must, in particular,
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think whether it would be appropriate to consult persons who the authority
thinks might become liable to pay a chargeable amount before the end of the
chargeable period of the BRS.
(6)
The levying authority must publish a revised version of an initial prospectus
if, in the light of the consultation on the proposal in the prospectus, the
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authority thinks that it is necessary or appropriate to do so.
(7)
A reference in section 5 to an initial prospectus includes a reference to an initial
prospectus revised under subsection (6) of this section.
(8)
A reference in subsection (2), (3) or (4) to a chargeable amount does not include
a reference to a chargeable amount of zero.
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Holding of ballot
(1)
There must be a ballot on the imposition of a BRS if—
(a)
A is more than one third of B, or
(b)
the initial prospectus states that, even though paragraph (a) does not
apply in relation to the BRS, the levying authority nevertheless thinks
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that there should be a ballot on the imposition of the BRS.
(2)
For the purposes of subsection (1)(a)—
“A” is the amount specified in the initial prospectus as the amount the
authority expects to raise from the imposition of the BRS, and
“B” is the amount specified in the initial prospectus as the amount the
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authority estimates as the total cost of the project to which the BRS
relates.
(3)
The proposition to be voted on in a ballot on the imposition of a BRS is—

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   “The [insert name of levying authority] proposes to introduce a business
rate supplement. The proposal is set out in [insert title of prospectus].
Should the proposed business rate supplement be introduced?”
(4)
A person is eligible to vote in a ballot on the imposition of a BRS if the person
is within section 6(2), (3) or (4).
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(5)
In a case where a revised initial prospectus is published under section 6(6), a
reference in this section to an initial prospectus is a reference to the revised
initial prospectus.
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Approval by ballot
(1)
If a ballot on the imposition of a BRS is held, the imposition of the BRS is
10
approved if—
(a)
a majority of the persons voting in the ballot have voted in favour of the
imposition of the BRS, and
(b)
A exceeds B.
(2)
F or the purposes of subsection (1)—
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“A” is the aggregate of the rateable values of each hereditament in respect
of which a person voting in the ballot has voted in favour of the
imposition of the BRS, and
“B” is the aggregate of the rateable values of each hereditament in respect
of which a person voting in the ballot has voted against the imposition
20
of the BRS.
(3)
For the purposes of subsection (2), the rateable value of a hereditament is its
rateable value on the day of the ballot.
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Regulations about ballots
(1)
Regulations may make provision in relation to the holding of a ballot on the
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imposition of a BRS.
(2)
The provision which may be made includes, in particular, provision about—
(a)
the timing of a ballot;
(b)
the form that a ballot may take;
(c)
who is to hold a ballot;
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(d)
the conduct of a ballot.
(3)
The regulations may, in particular—
(a)
confer functions on a levying authority;
(b)
enable a levying authority to appoint an officer of its to exercise on its
behalf a function conferred by virtue of paragraph (a) (a “ballot
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function”);
(c)
enable a levying authority to delegate to a lower-tier authority in
relation to it the exercise of a ballot function in the area of that lower-
tier authority;
(d)
enable a levying authority to delegate to a lower-tier authority in
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relation to it the exercise of a ballot function in the area of each other
lower-tier authority in relation to the levying authority;
(e)
enable a lower-tier authority to which the exercise of a ballot function
is delegated by virtue of paragraph (c) or (d) to appoint an officer of its
to exercise the function on its behalf.
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(4)
Regulations under this section may make provision as to who may cast a vote
in a case where the person eligible to vote is a body corporate, partnership or
unincorporated association.
(5)
Nothing in subsections (2) to (4) is to be taken as limiting the power conferred
by subsection (1).
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Variations
(1)
A levying authority may vary a BRS in so far as the variation is of a kind that
may be made in accordance with the final prospectus.
(2)
Otherwise, a levying authority may vary a BRS only if—
(a)
it has published a document that sets out the proposal for the variation,
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(b)
it has consulted the relevant persons on the proposal,
(c)
where there was a ballot on the imposition of the BRS or where there is
to be a ballot on the proposal by virtue of subsection (7), a ballot on the
proposal has been held and the variation approved, and
(d)
it has published a document that sets out the arrangements for making
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the variation.
(3)
A document published for the purposes of subsection (2)(a) or (d) must—
(a)
specify the amount that the authority expects to raise from the
imposition of the BRS on the assumption that the variation is made (the
specified amount to include the amount already raised from the
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imposition of the BRS),
(b)
specify the authority’s estimate of the total cost of the project to which
the BRS relates,
(c)
specify the day on which the variation will, if made, take effect, and
(d)
include, to the extent that the authority considers appropriate, such
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other information as would be included in an initial or final prospectus
if the proposal or arrangements were for the imposition of the BRS as
varied.
(4)
Section 5 applies as follows in relation to the publication of a document for the
purposes of subsection (2)(a) or (d)—
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(a)
subsection (2) of that section applies to the approval of a document
before publication for the purposes of subsection (2)(d) as it applies to
the approval of a final prospectus before publication;
(b)
subsection (3) of that section applies to a document published for the
purposes of subsection (2)(a) or (d) as it applies to a published initial or
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final prospectus;
(c)
subsection (4) of that section applies so far as necessary for the purposes
of the applications made by paragraphs (a) and (b) of this subsection.
(5)
The relevant persons for the purposes of consultation on a proposal to vary a
BRS are those who would be the relevant persons if the proposal were for the
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imposition of the BRS as varied; for that purpose, section 6 applies as if
references to the first day of the chargeable period of the BRS were references
to the day specified for the purposes of subsection (3)(c).
(6)
Section 6(6) applies in relation to a document published for the purposes of
subsection (2)(a) as it applies in relation to an initial prospectus.
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(7)
There must be a ballot on a proposal to vary a BRS if—

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(a)
A is more than one third of B, or
(b)
the document published for the purposes of subsection (2)(a) states
that, even though paragraph (a) of this subsection does not apply in
relation to the BRS, the levying authority nevertheless thinks that there
should be a ballot on the proposal.
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(8)
For the purposes of subsection (7)(a)—
“A” is the amount specified for the purposes of subsection (3)(a) in the
document published for the purposes of subsection (2)(a);
“B” is the amount specified for the purposes of subsection (3)(b) in that
document.
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(9)
In a case where a revised document is published by virtue of subsection (6), a
reference in subsection (7) or (8) to a document published for the purposes of
subsection (2)(a) is a reference to the revised document.
(10)
The proposition to be voted on in a ballot on a proposal to vary a BRS is—
   “The [insert name of levying authority] proposes to vary the business rate
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supplement set out in [insert title of prospectus and title of any document
setting out a variation to the BRS]. The proposal is set out in [insert title of
document setting out proposal]. Should the proposed variation be made?”
(11)
A person is eligible to vote in a ballot on a proposal to vary a BRS if the person
is within section 6(2), (3) or (4) (as applied by subsection (5) above); and
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sections 8 and 9 apply to a ballot on a proposal to vary a BRS as they apply to
a ballot on a proposal for the imposition of a BRS.
(12)
A variation the purpose of which is to increase the number of persons liable to
pay a chargeable amount may not be made in reliance on subsection (1) (and
that subsection is to be read accordingly).
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Liability to business rate supplements
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Liability of non-domestic ratepayers
(1)
This section applies in relation to a person who, as regards a hereditament, is
subject to a non-domestic rate under section 43 or 45 of the 1988 Act in respect
of a financial year.
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(2)
The person is, in relation to that hereditament and in respect of that year,
subject to such BRSs as are imposed for that year by the levying authority in
whose area the hereditament is situated.
(3)
But a person subject to a non-domestic rate under section 45 of the 1988 Act (a
“section 45 ratepayer”) is not subject to a BRS if—
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(a)
section 45A of that Act (empty properties: zero rating for charities and
amateur sports clubs) applies to the hereditament, or
(b)
the final prospectus for the BRS states that section 45 ratepayers are not
to be subject to the BRS.
(4)
A person who is subject to a BRS in relation to a hereditament in respect of a
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financial year is liable to pay in respect of that year an amount calculated by—
(a)
finding the chargeable amount for each chargeable day, and
(b)
totalling the amounts found under paragraph (a).
(5)
A chargeable day is a day—