Enterprise Bill

Written evidence submitted by the British Retail Consortium (ENT 23)

The British Retail Consortium has been leading the charge for fundamental reform of the business rates system. Reforms to the business rates system have the ability to help reinvent our high streets and ensure the retail industry’s continued investment in people and communities. The Enterprise Bill is an opportunity to ensure rental evidence can be shared upfront with ratepayers to decrease the number business rates appeals. This objective has broad agreement across the property and occupier business communities and we encourage Parliament to take advantage of this opportunity.

We also recommend the bill ensures Sunday trading relaxation is piloted in combined authorities with elected mayors and includes safeguards such as local impact assessments, community consultation and an appeals process if businesses feel they have been unfairly placed within a particular ‘zone’.

About the BRC

The BRC is the lead trade association for the entire retail industry. Our industry spans large multiples, independents, high streets and out of town, from online to bricks and mortar, selling goods across all industries from clothing, footwear, food and homeware to electronics, health & beauty, jewellery and everything in between, to increasingly discerning consumers. Our mission is to make a positive difference to the industry and to the customers we serve. Our broad range of stakeholders demonstrates how retailing touches almost every aspect of our culture. The BRC leads the industry and works with our members to shape debates and influence issues and opportunities that will help make that positive difference. We care about the careers of people who work in our industry, the communities retail touches and competitiveness as a fundamental principle of the industry’s success - our 3Cs.

Business rates Appeals

While the review is on-going, with the Government due to publish the results of its review at Budget 2016, one area where there has been agreement across Government and industry is in regard to reducing the number of unnecessary business rates appeals. As of 30 September 2015, there were more than 280,000 appeals outstanding in England. We agree something should be done to reduce the number of appeals. An important part of reducing the number of appeals is ensuring evidence for valuations is shared with ratepayers upfront. The Enterprise Bill does provide for greater sharing of information between the Valuation Office Agency (VOA), the body responsible for carrying out valuations and local government which we welcome.

However, ratepayers appeal when they have reason to believe their property assessment is inaccurate or where there has been no explanation of the evidence supporting the valuation. Many appeals would be avoided if the VOA more freely shared evidence with ratepayers indicating why a particular valuation was reached. Currently this information is only released in the late stages of an appeal. The VOA should be required to provide more extensive evidence about the basis for the ratings assessment upfront, in order to allow a ratepayer to audit their rateable value. Business rates are the only national tax in respect of which the taxpayer is not in possession of the relevant data, which forms the basis of the tax assessment and liability.

We recognise both the importance of safeguarding sensitive commercial information while ensuring ratepayers have access to information that may affect their individual valuation. Information should not be published for everyone to see, but it is reasonable for it to be made available to those it impacts earlier within the process. If the Commissioners for Revenue and Customs Act 2005 (CRCA) doesn’t permit earlier sharing of rental information as suggested in the Check Challenge and Appeal consultation, the Enterprise Bill should be amended to facilitate this.

At Report Stage in the Lords, the Earl of Lytton tabled the following amendment, which the BRC supports:

Clause 22 (now clause 25), page 40, leave out lines 3 to 5 and insert-

"(1) An officer of the Valuation Office of Her Majesty’s Revenue and Customs may disclose Revenue and Customs information to-

(a) a qualifying person for a qualifying purpose;

(b) a ratepayer for a hereditament.

(1A) Information disclosed under subsection (1)(b) may-

(a) be disclosed for the purpose of providing the ratepayer with all information used to assist determination of the valuation of any hereditament for which the ratepayer is responsible for the non-domestic rating liability and may be retained and used for that purpose, and

(b) include information relating to hereditaments not owned by that ratepayer."

Devolving Sunday Trading Rules

Change to Sunday trading regulation requires careful consideration. Relaxation would have significant implications for consumers and retailers large and small, based in town or out of town. In the context of the high street agenda, reform of and reduction in the burden of business rates would have a much greater positive impact than changes to Sunday trading. No two stores or two communities would be impacted the same, and so we strongly encourage a robust national impact assessment in addition to the requirement for local safeguards to be in place. Devolving powers on trading hours would be a major shift in policy and could create considerable uncertainty for retailers as they plan their local investment strategies meaning safeguards are essential to ensure that unintended consequences do not result.

Retail concerns include the resulting complexity, competition considerations and the fact that Sunday trading relaxation will not answer key questions over the future of the high street. Such powers should only be devolved to combined authorities with elected mayors [1] who have demonstrated readiness, capacity and capability. A national impact assessment with up-to-date and relevant evidence, including in relation to the impact on customers and employees, is needed.

Further safeguards needed include pilots for combined authorities with elected mayors, a local impact assessment to understand and inform the development of proposals, consumer consultation to measure public interest, a business ballot to assess support from the business community [2] , consideration of impact on other relevant local policies i.e. planning, licensing, delivery restrictions and an appeals process. Different zones within the same local authority could be used to unfairly treat particular businesses. If zoning is to be used there will need to be robust community consultation and an appeals process to ensure fairness.

February 2016

[1] For the purposes of Sunday trading the Greater London Authority (GLA) should be considered to be a combined authority with an elected mayor despite it resulting from the Greater London Authority Act 1999.

[2] Potentially similar to the ballot to determine Business Improvement Districts (BIDs).


Prepared 11th February 2016