A fair rate or legalised theft?

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As a High Street retailer in Rye of some 22 years, I always await with trepidation the notification of the new year’s business rates which come into effect at the beginning of April. This year, to my surprise, the increase was barely 2%. In recent years the increase has generally been in double figures. But a General Election looms and no doubt once done and dusted, the rise will revert to double figures.

If increases continue higher than inflation as they have over the past 10 years it won’t be long before my rates are higher than my rent – not that there’s any law against that. But the extremely high cost of rates is a contributing factor to many small businesses going into receivership.

Another argument against such exorbitant demands is that I’m already paying towards the council’s services via my domestic rates, paying twice for the same facilities in some cases. While I’m happy to contribute towards the provision of policing and fire services and it’s nice to have the rubbish collected on the High Street on a regular basis, should my business pay towards clearing fly-tipping, housing advice, leisure centres, running elections and many other irrelevant items? If my electricity supplier were to insist I contribute towards something that was not applicable to my business, I would soon switch to another supplier. But with commercial rates we have a repressive institutionalised system that would be the envy of many a utilitarian regime.

There is, of course, the Small Business Rate Relief scheme to help cushion the costs. To qualify, the rateable value of the business premises must be £12,000 or less, with relief on a sliding scale: from a small rebate at the top end down to 100% relief. My premises have a rateable value of £12,500.

This scheme hardly encourages the expansion of small businesses, but rather encourages one to stay small to receive maximum benefits. Another aspect of the quirky rating assessment is that rating charges vary according to the frontage: a shop 6ft wide and 100ft deep would get off very lightly, while one the same size but 100ft wide and 6ft deep would be heavily burdened. And, yes, you’ve guessed it: my premises are twice as long on the street as they are in depth.

Ironically, no sooner had I concluded this letter than Rother District Council invited me to apply for a reduction in my rates for the current year of “up to £1,000”. This scheme, available to certain small businesses with a rateable value under £50,000, was apparently the result of a previously unknown government directive dating from December 2013. Wasting no time I returned the application form and a few days later received notification that my rates had been lowered by £1,000.

Obviously, I was relieved. But the very existence of the scheme reflects the opposition to the punitive system imposed on small businesses. One supposes that Mr Cameron’s Government was forced to do something about it to avoid losing votes in the forthcoming General Election.

So, in conclusion, my new reduced rates are just short of £5,000 a year, still vastly inflated and unfair. But, as a result, I and the five people I employ just might survive another year in Rye High Street.

Shopkeeper name supplied and withheld on request