North West businesses continue to struggle with CCA, the new "Check Challenge Appeal" Business Rates Appeals System which remains inadequate, according to rating experts at the North West offices of global real estate advisors Colliers International.
New figures released by the Government show that in the 21 months between 1st April 2017, when the new system for appealing business rates was introduced, and 31st December 2018, just 9,380 ratepayers in the North West have begun to dispute the VOA's business rates assessments in England and of this total, just 1,310 proceeded to the ‘challenge’ stage – a figure described as ‘shockingly low’ by Hilary Witts (pictured), head of operations, rating at the North West offices of Colliers International in Manchester and Liverpool.
Of the 1,310 of the 9,380 ratepayers in the region in dispute with the VOA which have progressed to the ‘challenge’ stage, the actual appeals stage, only half of this number have been resolved since April 2017, a period of almost two years during which the North West was hit hard by town centre rental decline because of a high vacancy rate.
Across England as a whole, just 65,380 ratepayers have begun to dispute the VOA's business rates assessments, representing less than four per cent of the 1.88m properties assessed for business rates in the country and compared to 330,000 (over five times as many) appeals in the same period after the 2010 list.
Colliers International has been advising clients which are overpaying on their assessments and believe that the low numbers are because of the extremely arduous nature of the new appeals system for the 2017 Rating List.
Hilary added: “Over-complicated procedures, lack of guidance and a largely un-navigable new on-line portal are still discouraging those with good cases from challenging their bills. At the very least businesses now need to employ agents to help them get through the system, whereas before many could appeal directly themselves.”
Throughout England, the VOA figures also show that only 220,000 properties were approved by the VOA to begin the Check system and for CCA proceedings to begin. This means 160,000 are potentially still sitting in the system, not able to get through to the Check stage.
The pattern for Challenges nationwide is little better, with one third having been resolved.
John Webber, head of business rates at Colliers, said: “Our analysis shows that the 5000 challenges cleared averages out at 400 a month. However, since 800 a month are being submitted, it’s not difficult to see that the system is never going to clear them, and the situation will only get worse.”
CCA was introduced on the day the largest changes to business rates in a generation were published in April 2017. This included significant rate increases across London and the South East alongside a downside transitional scheme for the rest of the UK that offered little respite to rate payers in the depressed areas.
John added: “This has caused chaos and economic difficulty for many businesses, particularly retailers - as reported in the latest business news. The fact that it is so difficult to appeal against rates bills comes as a bitter pill on top of the massive rises so many have seen."
“We have also heard that because the VOA does not have the manpower to turn around the checks in the system quickly enough, it is “parking” some of the earlier submissions and concentrating on new ones coming in, so it appears to be more successful than it actually is. Some of these “parked” Checks need to be re-submitted which is distorting the figures. People are calling 2017 “The Lost List” because so few appeals are getting through.
“We understand the VOA is now engaging about the 2021 List and case workers are being re-assigned to deal with 2021 Revaluation in the naïve belief that 2017 will go away. We are also worried that some companies may miss the deadline for the 2017 list as this deadline date is now being disputed. We therefore suggest that if businesses have any concern about their rate bills, they get their disputes in now."
"It really is a system built around the mantra "the computer says no" . The ability to engage with actual real people would help enormously but we doubt that is the aim of the Government. The "we've got your money and we're keeping it" mentality seems to prevail".
John explained: "The lack of planning, insignificant time to trial the system before it went live and apparent lack of desire by the Government to engage with agents and their software providers has resulted in an appeal system unfit for purpose, however the VOA tries to dress up the figures. With the 2017 rating revaluation producing some of the largest increases in liability in a generation, and 2018/9 and 2019/20 building up further rises, it appears this government has proved again that it neither understands the pressures facing businesses or has a willingness to act on calls to change."