One in six business premises in Greater Manchester summonsed over business rates in 2012

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Paul Turner-Mitchell

Nearly 16,000 business premises in Greater Manchester were summonsed to appear before a magistrate in the last year after falling behind on business rates payments, new research carried out on behalf of the Grimsey Review has found.

The research, obtained through Freedom of Information Requests to all local authorities in Greater Manchester, found 15,714 business premises were summonsed to appear before a magistrate in 2012 an increase of 4.2% from 2010/11. Of those businesses, 8,351 were referred to Bailiffs for collection.

The research does not include Wigan Metropolitan Borough Council who failed to reply to the request.

The use of Bailiffs by councils to collect business rates has increased nationally by 18.32 per cent since 2010/11 but by 24.38 per cent across Greater Manchester.

The findings will fuel a growing sense that business rates have become an unsustainably high burden for businesses and are pushing many over the edge.

The research drew on responses to FOI requests to 90 local authorities and covered 40 per cent of the entire rating list for England. Although this accounts for all sectors, retail campaigner Paul Turner Mitchell, who collated the research, said retail was arguably the worst hit.

“Year after year we’re seeing big rates rises,” he said. “We’ve had two recessions and virtually no growth in the last five years. Yet the Government’s medicine to support businesses has been a £2billion rise in business rates in the last two years. This does not make sense. We need to be supported not seen as just a cash cow.

“While ministers boast about freezing council tax to support families they’ve done nothing to support the lifeblood of our economy and kept piling on taxes for small businesses.”

With some local authorities in Greater Manchester such as Manchester and Oldham summonsing more than a fifth of their entire business premises to appear before Court because of delays on business rates payments, retail veteran Bill Grimsey said there was a growing consensus that this was an unfair tax.

“It’s clear to me that a root and branch reform is needed to make business rates fair and equitable and less of a burden on retailers as a whole,” he said. “This is what my review will be looking at and we’re working hard to develop alternatives.”

Business rates income has increased by 12.49 per cent since 2010/11, and the business rate yield in England, after reliefs, represents a £2.4bn increase since 2010/11.