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Cost of business rate appeals backlog soars

Delays in dealing with business rate appeals are costing businesses £300 million per year, according to new research.

Business rates specialist CVS revealed in October that there was a backlog of more than 328,000 business rate appeals at the Valuation Office Agency (VOA), which calculates business rates and council tax in England and Wales. A third of the appeals date back to the 2005 business rate valuation.

CVS said that tens of thousands of business ratepayers who had paid too much in rates were now unable to get back the money owed to them due to an inefficient appeals process.

It said that at the VOA’s current rate of performance, it would take another 2.4 years to clear the backlog of appeals against rate valuations carried out in 2010 and that by holding over appeals from 2005 to consider alongside those from 2010 the VOA was making the backlog worse.

Don Baker, national head of rating at CVS, said: “the moment, businesses need all the revenue they can get and the VOA’s inefficiency is penalising companies unfairly and preventing those companies from recovering money that is rightfully theirs.

“This is weakening the financial health of a large number of SMEs across the country and damaging businesses’ ability to invest and grow. Urgent action is needed to clear the backlog and to give SMEs a fighting chance of leading the recovery.

“Every day the appeals backlog continues to grow and the delays are harming businesses’ ability to invest and contribute to local economic growth. The Government is championing a growth agenda and looking to private sector firms – and that means SMEs in particular – to stimulate investment. That policy and the VOA’s current performance are completely inconsistent.”

Link: Business rates guidance