Business Rates: Tax Allowances
The question
To ask the Chancellor of the Exchequer, pursuant to the Answer of 25 November 2024 to Question 14625 on Business Rate: Tax Allowances and with reference to line 18 of Table 5.1 of the Autumn Statement 2023, CP 977, for what reason the forecasts differ.
Answered by James Murray
Autumn Statement 2023 (AS23) announced 75 per cent relief to Retail, Hospitality and Leisure (RHL) properties up to a cash cap of £110,000 per business.
Based on local authorities’ Non-Domestic Rates form (NNDR1) returns, the static cost of RHL relief is forecast to be £2.4 billion in 2024/25. The costings contained in Table 5.1 of the ‘Policy Decisions’ chapter of AS23 account for the static cost being adjusted to reflect that business rates are deductible for Corporation Tax for companies and Income Tax for the self-employed, and that business rates are devolved. It also accounts for new burdens funding that English Local Authorities receive for the administrative and IT costs associated with the delivery of the relief.
Therefore, the final cost is estimated to be £2.65 billion in 2024/25. Further information can be found in AS23 Policy Costings on page 23: https://assets.publishing.service.gov.uk/media/6560c3ef3d77410012420197/Autumn_Statement_2023_Policy_Costings_-_Final.pdf
The Ministry of Housing, Communities and Local Government (MHCLG) will, in due course, publish outturn figures, based on data collected by local authorities, which will set out the final amount of business rate relief provided to businesses in 2024/25.
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