Wednesday, 08 March 2017 14:20

Little joy in Budget for rural business

Written by  Ruralcity Media
Little joy in Budget for rural business

THE government's Budget contained little joy for businesses in the countryside, say rural leaders.

The Country Land and Business Association welcomed a cap on business rates but said it was "insufficient for thousands of rural businesses facing immediate harm".

CLA president Ross Murray said: "We believe the Chancellor has listened to us.

He is taking action to help those small rural businesses who as a result of the 2017 revaluation no longer qualify for rates relief.

    See also: Pressure mounts over rural business rates

"The introduction of a cap is not the same as the 100% discount we called for but it is welcome.

"We are keen to see the details of the fund for discretionary relief as it is important this leads to opportunities for rural councils to help the worst affected rural businesses.

"However, these interventions are limited and leave thousands of rural businesses facing unaffordable rates hikes from 1 April."

Mr Murray voiced frustration that the chancellor had said nothing about the looming problem of processing business rates appeals.

"We expect to see thousands of inaccurate valuations challenged and it is not clear the Valuation Office is prepared to deal with these quickly and fairly.

"The chancellor's commitment to reform the revaluation system is the right thing.
"Few businesses suffering at this time will be reassured by the fact it will take five years before any meaningful changes are brought in.

"The new rating proposal must provide the right first time assessment to reflect the unique nature of rural business."

Meanwhile, higher National Insurance contributions are likely to hit small rural businesses and self-employed workers.

Chancellor Philip Hammond announced the hike in his Budget on Wednesday (8 March).

It means that Class 4 National Insurance payments will rise by 1% to 10% next year and a further 1% in 2019.

Rural insurer NFU Mutual said the move could could herald a move to bring self-employed people's National Insurance contributions up to the level of those paid by employees.

This is currently 12% for basic rate taxpayers.

NFU Mutual financial planner Sean McCann said: "This will add a further financial burden to thousands of farmers, contractors and rural service providers who have self-employed status.

But the announcement of smoothing for the introduction of new business rates would be welcome news for rural diversification enterprises.

"It's also a huge relief to country people that that the Chancellor did not impose penalties on diesel vehicle users aimed at reducing pollution in urban areas."

Mr McCann said such a move could have hit farmers and rural businesses hard.

"There was also welcome news for small businesses that the government's planned introduction of statutory quarterly tax returns will be delayed for a year, easing their administration costs."

 

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