Criticism over Deferred Business Rate Evaluation
Byline: SION BARRY email@example.com
PROPERTY advisory firm Cooke & Arkwright has criticised the Welsh Government decision to follow that of the UK Government in deferring business rate evaluation until 2017.
The firm said high street businesses are continuing to facing challenges due to the extent of out of town developments, car parking difficulties and the rise in internet shopping.
However it said the decision to defer revaluation - which in the current climate would reduce rates for many businesses - means that hard hit retailers will suffer even further.
Huw Thomas, director in charge of retail at Cooke & Arkwright said: "Letting shops in today's climate on many of our high streets is a significant challenge.
"The high street is under huge stress, but this is potentially a deal breaker for new lettings and lease expiries."
Andrew West, director in charge of rating said: "The most beleaguered businesses will continue to suffer an unfair, excessive tax base while those that have been most resilient during the recession bear a disproportionately low level of business rates." Cooke & Arkwright research shows that a typical shop in prime Commercial Street in Newport has a rate liability of PS80,500 in 2013.
If the revaluation had gone ahead this would have fallen to around PS45,000.
In one particular example, the former tenant chose to vacate on lease expiry and the property is now occupied by a charity shop.
Mr Thomas said, "Retailers' margins are so narrow, why would retailers choose to renew on lease expiry if business rates continue to be so high? "Historically the relationship between annual rates liability to rent would have been 35-40%, now business rates are either equal to, or in some extreme cases, exceed current rents. …