26 October
2016
Panther Securities
PLC
(the “Company” or
“the Group”)
Business rates
Further to the comments made in the Chairman’s Statement
included in the interim results announced on 27 September 2016, which contained information
about how business rates might affect the Group, the majority of
the new commercial rating values assessed on April 2015 values, but effective from
April 2017 for England and Wales, have been announced together with the
phasing arrangements due to be implemented.
As the Chairman, Andrew Perloff,
suspected, his cynicism was well founded. From a brief
research on a number of the new values for the Group’s properties,
it is apparent that the values have been placed higher than
justified by the April 2015 rental
values. Andrew Perloff
believes this is because the Valuation Officers have used what they
call the “broad brush approach”. Translated this means not
carrying out a thorough review of each property, but generalising
and taking the highest denominator, as that suits government
revenue raising purposes.
The Valuation Office is proposing to make it awkward for appeals
and possibly, in many cases, arrange that the Valuation Officer is
the Judge and Jury. But what Andrew
Perloff and many others find so ridiculously onerous is the
phasing proposals for larger properties. These properties,
which have been overvalued for two years and thus their business
rates have been excessively high (because of the delayed
revaluation), will continue to bear a huge burden. The
decrease is phased in at 4.6% in the first year, 5.1% the second
year and even after 5 years will only receive about 25% of the full
reduction due to them. This is a truly parsimonious decrease
and does not take account of the likely inflation linked adjustment
that will be added to then business rates bills and almost
certainly, in due course, wipe out the miserly reductions.
On the other side of the coin, those with big increases in
business rates (mostly central London) that have saved money by the two-year
delay are now being hit with a massive 45% first year increase.
Leaving aside the scandal of charging at full level business
rates on vacant properties, the Directors believe this is a
disgraceful, sneaky and unfair imposition. Larger retailers
based out of the London area, will
be hit hardest, particularly those in the northern parts of
England.
It is the government’s stated wish to create a northern
powerhouse. However, in the Directors’ view the Valuation
Office’s approach to the phasing of the new commercial rating
values is going to have the complete opposite effect.
Panther believes that the phasing of the new business rates will
have an adverse effect on the ability to let some of its vacant
properties, particularly in the north of England, but it intends to find other ways of
improving the ability to let these properties.
Andrew Perloff, Chairman of
Panther, stated “If this is the best they can do on a rates
revaluation then I doubt if they could create a profitable hot dog
stall outside of Wembley Stadium on Cup Final Day, even if they
issued themselves the only licence!”
For further information:
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Panther Securities plc: |
Tel: 01707 667
300 |
Andrew Perloff/ Simon Peters |
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Allenby Capital Limited (Nomad
and Joint Broker) |
Tel: 020 3328
5656 |
David Worlidge/ Alex Brearley |
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