Gary L Watson IRRV (HONS) Deputy Chief Executive IRRV LATEST DEVELOPMENTS IN COUNCIL TAX & NON-DOMESTIC RATE (APRIL 2014 TO JANUARY 2015) - BRISTOL: 30TH JANUARY 2015 Gary L Watson IRRV (HONS) Deputy Chief Executive IRRV

SCOPE OF PRESENTATION Introduction Legislation Guidance Notes Information Letters Consultation / Discussion Papers Bills before Parliament Press Release Announcements Reports / Papers / Publicity Case Law The Institute

INTRODUCTION Government Agenda - Spending Review * Provide greater flexibilities to local authorities * Three areas of reform to local government finance:- - Local retention of business rates - Replacement of council tax benefit by local council tax support - Technical reforms of council tax - Local Government Resource Review * Part of agenda for decentralisation and localism * Redistribution of power and funding from government to local people * Aim is to keep levels of council tax down

INTRODUCTION Primary Legislation - General Rate Act 1967 - Local Government Finance Act 1988 - Local Government and Housing Act 1989 - Local Government Finance Act 1992 - Local Government and Rating Act 1997 - Local Government Act 2003 - Rating (Empty Properties) Act 2007 - Localism Act 2011 - Local Government Finance Act 2012 - Housing (Wales) Act 2014 Secondary Legislation

LEGISLATION (COUNCIL TAX) Discounts - Section 139 Housing (Wales) Act 2014 * General - Royal Assent 17/09/14 - Comes in to force on TBC * Purpose - Inserts Section 12A to the Local Government Finance Act 1992 * Higher amount for long-term empty dwellings - Inserts Section 12B to the Local Government Finance Act 1992 * Higher amount for dwellings occupied periodically

LEGISLATION (COUNCIL TAX) Chargeable Dwellings - Council Tax (Chargeable Dwellings) (Amendment) (Wales) Order 2014 (S.I.2014/2653) * General - Laid before Welsh Assembly on 01/10/14 - Came in to force on 22/10/14 * Purpose - Amends S.I.1992/549 - Provides that a refuge must be treated as one dwelling even if the property comprises more than one self-contained unit

LEGISLATION (NON-DOMESTIC RATE) Re-valuation - Rating Lists (Postponement of Compilation) ( Wales) Order 2014 (S.I.2014/1370) * General - Laid before Parliament on 23/05/14 - Came in to force on 06/06/14 * Purpose - Cancels proposed revaluation scheduled for 1st April 2015 and provides a ‘tone of the list’ of 1st April 2015 for the rating lists that are effective from 1st April 2017

LEGISLATION (NON-DOMESTIC RATE) Re-valuation - Rating Lists (Valuation Date) (England) Order 2014 (S.I.2014/2841) * General - Laid before Parliament on 28/10/14 - Came in to force on 21/11/14 * Purpose - Provides a ‘tone of the list’ of 1st April 2015 for the rating lists that are effective from 1st April 2017

LEGISLATION (NON-DOMESTIC RATE) Business Improvement Districts - Business Improvement Districts (Property Owners) (England) Regulations 2014 (S.I.2014/3204) * General - Laid before Parliament on 01/12/14 - Came in to force on 02/12/14 * Purpose - Allows for property owner Business Improvement Districts to be promoted where a business rate supplement and a ratepayer Business Improvement District are in place

LEGISLATION (NON-DOMESTIC RATE) Multiplier - Local Government Finance Act 1988 (Non-Domestic Rating Multipliers) (England) Order 2014 (S.I.2015/?) * General - Laid before Parliament on 07/01/15 - Came in to force on 08/01/15 * Purpose - Specifies multipliers for 2015/16 for the purposes of Schedule 7(3) Local Government Finance Act 1988 * Standard multiplier: 49.3p * Small business multiplier: 48.0p * Government will cap retail price index (RPI) increase in bills to 2% in 2015/16 (a ratepayer would have been faced with a 3.2% increase)

LEGISLATION (NON-DOMESTIC RATE) Appeals - Non-Domestic Rating (Alteration of Lists and Appeals) (England) (Amendment) Regulations 2015 (S.I.2015/?) * General - Laid before Parliament on TBC - Comes in to force on 28/02/15 * Purpose - Amends S.I.2009/2268 - Restricts alterations of the rating list to 1st April 2015 if a proposal is made after 31st March 2015

LEGISLATION (COUNCIL TAX & NON-DOMESTIC RATE: ENFORCEMENT) Taking Control of Goods Regulations 2013 (S.I.2013/1894) - Introduced under Schedule 12 Tribunals, Courts and Enforcement Act 2007 - Laid before Parliament on 30/07/13 - Came in to force on 06/04/14 Taking Control of Goods (Fees) Regulations 2014 (S.I.2014/1) - Laid before Parliament on 09/01/14

LEGISLATION (COUNCIL TAX & NON-DOMESTIC RATE: ENFORCEMENT) Certification of Enforcement Agents Regulations 2014 (S.I.2014/421) - Introduced under Schedule 12 Tribunals, Courts and Enforcement Act 2007 - Laid before Parliament on 28/02/14 - Came in to force on 06/04/14 Tribunals, Courts and Enforcement Act 2007 (Consequential, Transitional and Saving Provision) Order 2014 (S.I.2014/600) - Laid before Parliament on 12/03/14

LEGISLATION (COUNCIL TAX & NON-DOMESTIC RATE: ENFORCEMENT) Insolvency Proceedings (Monetary Limits) (Amendment) Order 2015 (S.I.2015/26) - General * Laid before Parliament on 14/01/15 * Came in to force on 01/10/15 - Purpose * Amends the Insolvency Proceedings (Monetary Limits) Order 1986 (S.I.1996/1986) increasing for debt relief orders the maximum amount of a person’s debts to £20,000 (from £15,000) and maximum value of property to £1,000 (from £300)

GUIDANCE NOTES (NON-DOMESTIC RATE) Reoccupation Relief - Section 47 Local Government Finance Act 1988 - Guidance note * General - Published 01/04/14 - Purpose (including funding) * Section 1 - How will the relief be provided - Which properties will benefit from the relief? - How much relief will be available - How long will relief last - State aid - Practical issues

GUIDANCE NOTES (NON-DOMESTIC RATE) Extension of Transitional Relief - Section 47 Local Government Finance Act 1988 - Guidance note * General - Published 14/01/15 - Purpose (including funding) * Section 1 - How will the relief be provided - Which properties will benefit from the relief? - How much relief will be available - Recalculations of relief - State aid - Practical issues

INFORMATION LETTERS (COUNCIL TAX) www. gov INFORMATION LETTERS (COUNCIL TAX) www.gov.uk/government/collections/council-tax-information-letters (1/2014) - 23rd September 2014 - Definitions of (and guidance on) empty homes and second homes

INFORMATION LETTERS (NON-DOMESTIC RATE) www. gov INFORMATION LETTERS (NON-DOMESTIC RATE) www.gov.uk/government/collections/business-rates-information-letters (7/2014) - 2nd April 2014 - Reoccupation Relief Guidance - Interest Rate 2014/15 (8/2014) - 11th April 2014 - Review of Business Rates Administration – Discussion Paper (9/2014) - 3rd July 2014 - Autumn Statement Compensation

INFORMATION LETTERS (NON-DOMESTIC RATE) www. gov INFORMATION LETTERS (NON-DOMESTIC RATE) www.gov.uk/government/collections/business-rates-information-letters (10/2014) - 24th October 2014 - Business rates retention and shale oil and gas: consultation on draft regulations - Business rates on cash machines - Information on local authority web sites

INFORMATION LETTERS (NON-DOMESTIC RATE) www. gov INFORMATION LETTERS (NON-DOMESTIC RATE) www.gov.uk/government/collections/business-rates-information-letters (11/2014) - 4th December 2014 - Autumn Statement * Business rates measures - Small business relief - Multiplier - Retail relief - Transition (2 years: RV up to £50,000) - Appeals against the list * Business rates reform - Future structure: Budget 2016 - Interim findings on administration: December 2014

INFORMATION LETTERS (NON-DOMESTIC RATE) www. gov INFORMATION LETTERS (NON-DOMESTIC RATE) www.gov.uk/government/collections/business-rates-information-letters (11/2014) - 4th December 2014 (Cont.) - Provisional multipliers 2015/15 * Standard: 49.3p * Small business: 48.0p (Note: Government will cap retail price index (RPI) increase in bills to 2% in 2015/16 (a ratepayer would have been faced with a 3.2% increase) - Property owner business improvement districts * Reference to S.I.2014/3204 * Only applies to London

INFORMATION LETTERS (NON-DOMESTIC RATE) www. gov INFORMATION LETTERS (NON-DOMESTIC RATE) www.gov.uk/government/collections/business-rates-information-letters (12/2014) - 12th December 2014 - Review of Business Rates Administration Interim Findings - Summary of responses to the Consultation Checking and Challenging your Rateable Value - Business Rates Avoidance Discussion Paper (1/2015) - 12th January 2015 - Business rates and childcare providers - Extension of Transitional Relief for Small and Medium Properties: Guidance

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Checking and Challenging your Rateable Value - General * Published 05/12/13 * Responses due by 03/03/14 - Scope * Summary * Disadvantages with the current system * Government’s proposals - Improving transparency of the valuation process - Submitting a formal challenge - Separating ‘proposal’ from ‘an appeal’ * 7 ‘key’ questions * Implementation

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Checking and Challenging your Rateable Value (Cont.) - Open Letter 31/07/14 - Findings * Published 10/12/14 * Summary - 71 responses (19 local authorities, 20 rating agents, 13 representative bodies and 19 businesses) - Responses to the 7 ‘key’ questions * Way forward - To form part of the Business Rates Administration Review

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Administration of Business Rates in England - General * Published 10/04/14 * Responses due by 06/06/14 - Scope * How property is valued (5 questions) * How often is property valued (6 questions) * How rate bills are set (5 questions) * How business rates are collected (4 questions) * How information about ratepayers and business rates is used (4 questions)

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Administration of Business Rates in England (Cont.) - Findings * Published 10/12/14 * Summary - 217 responses * Broadly 100 from businesses and their representatives * Broadly 100 from local government * Remainder from individuals and think tanks * Analysis under 4 headings - How property is valued - How often property is valued - How rate bills are set and collected - How information on ratepayers and rates is provided and used

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Administration of Business Rates in England (Cont.) - Key areas * A majority of respondents want to retain the current valuation method whereby each property receives an individual valuation * Just over half of respondents, including most businesses and their representatives, favoured more frequent revaluation cycles than currently, believing this would # align rateable values to market conditions * A significant minority of respondents, including most representing local government, did not favour more frequent revaluations, arguing that this would result in decreased certainty and stability to both business and local government

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Administration of Business Rates in England (Cont.) - Key areas (Cont.) * Most respondents, including more than half of businesses, felt billing and collection needed significant improvement and that digital options should be explored * Although most respondents recognised that the timely and accurate collection of information was integral to the effectiveness of the business rate system, views differed as to how this might be improved

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Administration of Business Rates in England (Cont.) - Further consultation * Responses due by 28/02/15 * Scope - How often property is valued (4 questions) - Challenging and appealing rateable values (4 questions) - Information gathering, use and exchange (3 questions) - Billing and collection (3 questions) (Note: The ‘terms of reference’ for the review of the future structure of business rates is yet to be announced)

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Business Rates Retention and Shale Oil and Gas - General * Published 24/10/14 * Responses due by 05/12/14 - Scope * Proposal for 100% retention by local authorities of rate income from shale and gas * Draft regulations included - Findings * Published 23/01/15 * Summary - 25 responses (10 local authorities, 15 others) - Two key areas (funding and definition) - Regulations to remain ‘as drafted’

CONSULTATION / DISCUSSION PAPERS (NON-DOMESTIC RATE) Business Rates Avoidance - General * Published 10/12/14 * Responses due by 28/02/15 - Scope * Summary * Methods and scale of avoidance (3 questions) * Tackling avoidance (6 questions)

CONSULTATION / DISCUSSION PAPERS (COUNCIL TAX & NON-DOMESTIC RATE) Powers of Entry - General * Published 23/01/15 * Responses due by 20/02/15 - Scope * Summary * Two key areas - Section 26 Local Government Finance Act 1992 - Schedule 9(7) Local Government Finance Act 1988 * Proposals - Need approval from a tribunal to gain access - Align fines to level 1 of the standard scale - Align periods of notice to 3 days

BILLS BEFORE PARLIAMENT: 2014 (COUNCIL TAX) Council Tax Valuation Bands Bill 2014 - General * Introduced in to the House of Lords by Lord Marlesford (Conservative) - Purpose * Proposes new valuation bands for England - Band A: Below £250,000 (6/16) - Band B: Between £250,001 and £500,000 (8/16) - Band C: Between £500,001 and £1,000,000 (12/16) - Band D: Between £1,000,001 and £2,000,000 (16/16) - Band E: Between £2,000,001 and £5,000,000 (24/16) - Band F: Between £5,000,001 and £10,000,000 (48/16) - Band G: Between £10,000,001 and £20,000,000 (100/16) - Band H: Over £20,000,001 (250/16)

BILLS BEFORE PARLIAMENT(COUNCIL TAX)

PRESS RELEASE (NON-DOMESTIC RATE) Councils urged to boost access to free-to-use cash machines on high streets - Published 26/12/14 - Statements * Penny Mordaunt MP - Background to rating position - Reasons for press release - Billing authorities encouraged to use Section 47 discretion * Statement from Association of Convenience Stores - Support of press release * Statement from Frank Field MP - Further Information * Details of all steps taken to help local firms

ANNOUNCEMENTS (COUNCIL TAX & NON-DOMESTIC RATE) 20th May 2014 (Charity Commission) - Business rates relief * A statutory enquiry had been opened against five charities over concerns that trustees’ have entered in to agreements to occupy vacant commercial properties, resulting in the charity becoming potentially liable for the payment of significant business rates. Warnings over the risks had been issued in December 2011 and May 2013. 17th October 2014 (Upper Tribunal - Lands Chamber) - Change of address * The new address from the 17th October 2014 will be 5th Floor, 7 Rolls Buildings, Fetter Lane, London, EC4A 1NL. The majority of London based hearings will be in the Royal Courts of Justice in the Strand.

ANNOUNCEMENTS (COUNCIL TAX & NON-DOMESTIC RATE) 1st October 2014 (Valuation Tribunal) - Change of address * The new address from the 1st October 2014 will be 2nd Floor, 120 Leman Street, London, E1 8EU. This will also be the address of the new hearing venue.

REPORTS / BRIEFINGS / LEAFLETS (NON-DOMESTIC RATE) Business Rates: Guidance for M.P’s - Published 20/06/14 - Purpose - http://www.parliament.uk/briefing-papers/SN06247/business-rates Valuation Office Agency Leaflet: How we value pubs and licensed premises - Published 19th January 2015 - https://www.youtube.com/user/VOAgovuk

REPORTS / BRIEFINGS / LEAFLETS (COUNCIL TAX & NON-DOMESTIC RATE) Adjudicator’s Office Annual Report 2013/14 - Key information * 27 new complaints against the VOA received * 23 resolved and 5 partially upheld * Monetary compensation levels - £14,291: Costs - £275: Poor complaints handling - £50: Worry and distress * http://www.adjudicatorsoffice.gov.uk/pdf/report2014.pdf

CASE LAW (COUNCIL TAX) Liability - Soor and Bhogal v Redbridge LBC Reliefs: Exemptions - R Q v Bromley LBC - J C v Shropshire C - K v Portsmouth CC & Houseletdirect v Newham LBC - K v Wolverhampton, F v Wychavon DC & J v South Staffordshire DC - A2Dominion Housing Group Ltd v Hammersmith & Fulham LBC, Notting Hill Housing Trust v Kensington & Chelsea RBC & Notting Hill Housing Trust LBC

CASE LAW (COUNCIL TAX) Reliefs: Discounts - Earl v Winchester CC - Percival v Ealing LBC - Orme v Charnwood BC Reliefs: Reductions - S C v East Riding of Yorkshire C & C W v East Riding of Yorkshire C Recovery - R (On the Application of Coverdale) v Hastings Magistrates’ Court - Thompson v Redbridge LBC - Reverend Paul Nicolson v Haringey LBC

CASE LAW (NON-DOMESTIC RATE) Liability: Exemptions - Church of Jesus Christ of Latter-Day Saints v United Kingdom - A & N Frozen Foods v Alexander (VO) Liability: Unoccupied Rate - Aviva Investors Property Develop. Ltd & Another v Whitby (VO) & Mills (VO) - Tull Properties Ltd v South Gloucestershire CC - Pall Mall Investments (London) Ltd v Leeds CC - Metis Apartments Ltd v Grace (VO) and Sheffield CC - UKI (Kingsway) Ltd v Westminster CC and Dunlevey (VO) - Derwent Holdings Ltd v Ms Susan Whitehead (VO) and Preston CC - Schroder Exempt Property Unit Trust and Another v Birmingham CC

CASE LAW (NON-DOMESTIC RATE) Recovery - Kaye v South Oxfordshire DC and Another - R (On the Application of Augustine Housing Trust) v Bolton Magistrates’ Court (Bolton MBC an Interested Party)

THE INSTITUTE (CONFERENCES / SEMINARS / PROFESSIONAL MEETINGS / TRAINING COURSES) - Local Taxation & Revenues (Keele: June 2015) - Annual (Telford: October 2015) Seminar - Welfare & Benefits (London: February 2015) Professional Meetings - Completion Notices (London, Bradford, Hinckley, Manchester: April / May 2015) - Latest Developments in NNDR (London, Bradford, Hinckley, Manchester: February 2015)

THE INSTITUTE (CONFERENCES / SEMINARS / PROFESSIONAL MEETINGS / TRAINING COURSES) - Masterclass: Council Tax (London: Various dates) - Masterclass: NNDR (London: Various dates) - Introduction: Council Tax (London: Various dates) - Introduction: NNDR (London: Various dates)

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Gary L Watson IRRV (Hons) Deputy Chief Executive IRRV CONTACT DETAILS Gary L Watson IRRV (Hons) Deputy Chief Executive IRRV Telephone: 0207-691-8988 E-Mail: Gary.watson@irrv.org.uk