Glasgow’s leisure businesses extremely concerned over rates revaluation
Representatives from the city’s leisure sector have expressed their dismay over the 2017 Business Rates Revaluation process, which they say is unfairly weighted against licensed businesses.
Licensed premises are subject to a different assessment method for determining business rates than other sectors, with a major focus on turnover in calculating the final rateable value. The assesors use sales figures from 2014/15 which futher inflates the values for many businesses which reported a bumper year due to external factors such as the Commonwealth Games.
Senior representatives from the leisure sector supported by city business organisations including Glasgow Chamber of Commerce, the Glasgow Restaurants Association, Greater Glasgow Hotels Association and the Sauchiehall Street Business Improvement District recently attended a crisis meeting on the issue as they feel this ‘dual-process approach’ is unfair, inflating rateable value in an industry synonymous with low margins and rising operating costs.
With new bandings coming into effect on April 1, many businesses’ rateable values are set to surge.
The news falls just after Glasgow launched its ambitious Tourism and Visitor Plan to attract one million more visitors by 2023. Many of the businesses that will be most affected are those which are integral to Glasgow’s offer as a great place for visitors to come and enjoy.
The retail and night time economy was recently valued by the Moffat Centre as collectively contributing £5.46 billion to the city’s economy, generating more than 33,000 full-time jobs.
Glasgow Chamber of Commerce is encouraging businesses to check their proposed rates Business Rates revaluation and to lodge an official appeal if the figures from the assessor have greatly increased.
Stuart Patrick, chief executive of Glasgow Chamber of Commerce said: “The underlying sentiment which came out of the meeting is one of major concern from the leisure business community about the methodology in which revaluations are calculated for the licensed trade.
“We are in a situation where licensed premises are subject to a different assessment process than businesses in other sectors, creating an unequal playing field.
“These companies are a crucial asset in support of the city’s tourism strategy but instead of being able to look forward they’ve instead come under major pressure with some set to experience a doubling of their annual business rates bill.
“Glasgow’s night-time economy which includes world-class restaurants, bars and nightclubs, is a key driver for people choosing to visit the city and this revaluation process sends out the wrong message.
“Businesses in the leisure industry should closely check their revaluation and start the appeal process if they are affected by a large rise in rateable value.
“During the appeal process businesses are liable for the increased rates bill and given the process can take a number of years to conclude we would be keen to understand if there will be any form of transitional relief available to the sector.”
Duncan Johnston, General Manger of Hotel Indigo Glasgow said: “Any potential rise in business rates is of great concern for hoteliers, some of whom are reporting increases of up to 200%. At a time when the city is placing a huge focus on boosting the number of visiting tourists putting an extra strain on hotels doesn’t seem very sensible.
“It will also deter investors, put off by tighter margins if rates are inflated. This would have a negative impact on new hotels coming into the city and investment for our existing stock.”
Ryan James, chairman of Glasgow Restuarants Assocaiton said: “There are many different pressures facing the city’s restaurant businesses, which are so tightly squeezed I genuinely believe rate increases could be the final straw.
“Our independent culinary offering will undoubtably suffer and as one of the city’s prized attributes to visitors and locals alike, this is unacceptable.
“I honestly can’t get my head around why licenced businesses are subject to a different assesement method than other companies and feel this is extremely unfair.”
Brian Fulton, chairman of the Sauchiehall Street BID said: “As a Business Improvement District, our members grouped together to contribute an added percentage on top of existing rates specifically to enhance the overall area so any further forecasted rises in rateable value will be very unsettling news.
“The majority of businesses along Sauchiehall Street are licenced premises, faced with the same challenges experienced by the industry as whole so we’re understandably wary of any additional financial burden resulting from an unfair assessment process.”