Latest Government figures released in May on CCA, the "Check Challenge Appeal" Business Rates appeals system, illustrates how badly the system is faring two years in- the backlog of claims is growing and the VOA, the Government’s Valuation Agency is under- resourced to deal with this.
CCA came into force on 1 April 2017, despite voiced concern from business rates professionals that it had not been properly thought through. Aimed to speed up the appeals system by striking out any unnecessary claims early on and by using an on-line portal system, the VOA asserted this would create a much more streamline system from which companies could benefit.
In reality we now have a much more cumbersome system than was in place previously. At first step CCA requires ratepayers to “Check “the information held on the property by the VOA, claim multiple properties separately and prove the identity of the ratepayer with supporting documentation, Once a property is through the Check system, the ratepayer can launch a “Challenge” to the rating assessment it has been given and only at a third stage lodge an “Appeal” against this. So far, the number of appeals that have finally made it through this system, can be counted on one hand.
The strain on the system is evident- only 258,170 properties have been approved by the VOA to begin the Check system in the two-years since introduced. Of these only 82,400 Checks have now been registered -less than 5% of the 1.88 million properties assessed for business rates in the country. 175,770 are therefore potentially still sitting in the system, and will be coming down the line in the months ahead. And the 82,400 properties in England checked compares to over 441,000 appeals in the same period after 2010, almost five times as many.
The pattern for “Challenges” is not much better. Latest figures show that of the 12,930 Challenges registered only around 37% (4,740) have been resolved and 6,980 are outstanding- averaging out at less than 198 a month cleared. In March 2019- 700 Challenges were cleared, BUT 1440 Challenges were submitted. This differential between the two figures is growing every month showing that the system is going to increasingly struggle to clear such challenges.
Frustration with the system is borne out by Colliers’ own FOI requests to the VOA about the process. Since launch, 87% of users out of 2928 respondents trying to get their business rates checked have been dissatisfied or very dissatisfied (17% and 70% respectfully).
In comments about the system, respondents seem most frustrated about the lack of clarity about how to navigate it, lack of opportunity to provide comment or explanation about their individual cases or why they are appealing the rating valuation;
Such complicated procedures and the largely un-navigable on-line portal seem to have therefore discouraged many companies from starting the whole CCA process, despite many with good cases for challenging their bill. And for those that do, the slow rate at which they are being processed is alarming.
So, what should companies do going forward? We are worried that some may miss the deadline for the 2017 list. At the present time the legislation is silent on a deadline. But unfortunately for ratepayers and agents, panic may set in shortly as an announcement on a deadline could give as little as 3 months’ notice -as happened in December 2014. We therefore suggest that if businesses have any concern about their rate bills, they claim, register and begin the check process now.
And the Government? We suggest they scrap CCA, create a register of rating professionals and make a total review of reliefs and exemptions. They should introduce an online tax to reduce this 50% plus tax. And genuinely allow businesses to challenge their assessments where they are clearly incorrect without employing an army of advisors at a big cost.
If ever there was a time when Government should be listening to business surely it is now? Mr Johnson and Mr Hunt, please take note.