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News Release

London

Chancellor announces plans to make newly built commercial buildings exempt from empty rates

Jones Lang LaSalle’s reaction 


London, 5th December 2012 – The Chancellor of the Exchequer has today announced in his Autumn Statement that in order to promote further private investment the Government will exempt all newly built commercial property completed between 1 October 2013 and 30 September 2016 from empty property rates for the first 18 months, up to the state aid limits and subject to consultation.

Tim Beattie, Lead Director, Rating at Jones Lang LaSalle commented that this a very welcome boost to the property industry and follows the informal appointment of Julian Sturdy MP (Con, York) by the Chancellor to look at how empty property rates could be varied to leverage economic growth.

Tim said: “Subject to the detail of the consultation process and the state aid limits it could clearly see some speculative schemes being started sooner rather than later but there will also be a tension between these provisions and the localism agenda enshrined in the Local Government Finance Act 2012.  Billing Authorities are expected to take a keen interest in new development in their area after 1 April 2013 because they will benefit from the increased tax take.”

Further welcome news was provided in the announcement that the Government will extend the temporary doubling of the Small Business Rate Relief scheme for a further 12 months from 1 April 2013. 
Tim added: “Hard pressed retailers and local businesses however, have been calling for the government to reverse its ill thought out decision to postpone the 2015 Revaluation to 2017 thus deferring the benefits of a Revaluation to these businesses by two years.  The next revaluation would re-distribute the rates burden in line with current economic activity thus easing the pressure on high streets in particular.”