DCLG has published a consultation on the Government’s proposal to allow Local Authorities to retain 100 per cent of the business rates they raise. The aim of this fiscal devolution is to provide communities with the financial independence, stability and incentives to push for local growth, and the consultation seeks to identify some of the issues that should be kept in mind when designing the reforms.

While the consultation contains no specific mention of charities, and only limited references to reliefs, this is another opportunity to remind the Government of the importance of protecting the 80% mandatory charity relief. CTG welcomes the Government’s undertaking to do so – confirmed in the 2016 Culture White Paper and the Government’s response to evidence in its business rates review released in March, as well as by the Minister at CTG’s Charity Tax Conference. This is also an opportunity to highlight the further pressure that this proposal may put on the 20% discretionary relief.

Responses should be sent to DCLG via email, before 26 September 2016.

Following this consultation, a more technical consultation on the specific workings of the system is expected in Autumn 2016. Legislation will then be introduced to Parliament in early 2017 and pilot programmes will hopefully begin from April 2017. The Government expects 100 per cent business rates retention to be implemented across all Local Authorities by the end of the Parliament.