Protest over hike in business rates

Property firm Cluttons has accused the Government of hypocrisy after it ruled out any plans to freeze a 5% rise in business rates on April 1.

The firm called the Chancellor’s decision “bizarre”, given that housing minister Margaret Beckett has just announced new support to help councils cut their planned rent increases for tenants in the current economic climate.

According to Communities and Local Government, the average guideline rent increase for 2009/10 will be halved from 6.2% to 3.1%, meaning that council house tenants should now be paying just under £2 more a week.

In the accompanying announcement CLG states that the initial hikes in council rent were set back in September, when inflation was much higher.

Peter Chapman, head of rating at Cluttons, said that large hikes in business rates would be the last straw for many firms.

He said: “It is hard to see where there is a difference between local authority rents and business rates when both increases for 2009/10 were set last September when RPI inflation was 5% and both may need supporting during the current economic uncertainty. The fact that RPI has now fallen to 0.1% suggests the Government’s criteria for helping those groups struggling in the recession is purely based on potential votes rather than sound economics.

“The Government is clearly cherry-picking who it favours and is putting politics before economics.”