Newspaper article The Journal (Newcastle, England)

Tax Is Damaging Our Ability to Grow Again

Newspaper article The Journal (Newcastle, England)

Tax Is Damaging Our Ability to Grow Again

Article excerpt

Byline: KEVAN CARRICK

IHAVE reported on many occasions that the Empty Property Rates tax is damaging to the North East economy. The Royal Institution of Chartered Surveyors (RICS) this week publishes a new survey that illustrates the impact of this unwarranted levy.

In short, 89% of respondents - mainly chartered surveyors - believe EPR restricts economic growth and 92% view EPR as a barrier to town centre regeneration.

Empty rates are levied where a property is vacant. Retail shops have a holiday from the levy for three months and offices and factories for six months.

The tax was imposed in 2006/07 with the claim that properties were deliberately being kept empty and was an incentive for landlords to let the space or be penalised for not doing so.

I co-authored a report for former regional development agency One North East that showed there was no evidence landlords were deliberately keeping property empty and that the impact of the tax was to take PS32.5m out of the region in 2006/07 before rising in 2009/10 to an estimate of PS35m.

The recession has had a much greater impact, and now I think that this was underestimated and is close to PS100m. I believe that the Treasury now acknowledges that this is in fact a tax that bolsters the Government's income. But it is a tax that is significantly damaging the efforts being made to achieve economic growth and jobs in the region.

The RICS survey is a national call for changes to help boost the construction and property sectors to create growth and jobs. We want to: ? Exempt new-build property from the payment of empty rates for 12 months.

Increase the exemption for empty existing retail property from three to six months.

Increase the exemption for empty existing office and factory property from six to 12 months.

See all refurbishment, renovation or retrofitting projects removed from the business rate list until completion. …

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