Under the new rules there will still be no charge for the first three months they are empty. After that time full rates must be paid even if a tenant has not been found. After six months factories and warehouses will lose, what was 100 per cent relief. Properties that have already been vacant for the three or six months at 1 April 2008 will immediately attract the full rate, as the tax is retrospective.
In their joint letter the trade bodies tell the Government that if it cannot prove its claims that the extra tax will increase property availability and reduce rents, it must reintroduce the 50 per cent relief or extend the period when no rates are due to better reflect the time taken to fill vacant property.
BRC Director General, Stephen Robertson, said: “The Government must take us for April Fools. It is ignoring the mechanics of the property market because of a desperate need to plug holes in the budget at a time when the economic slowdown makes it more likely business premises will fall vacant. In the current economic climate Government should be alleviating the tax burden on businesses, not making them less competitive.
“No one gains by keeping property empty. It's unoccupied because there isn't the demand for it at that time and place. Piling on taxes will not conjure up new tenants or drive down rents but will weaken the prospects for local regeneration.”
Liz Peace CBE, Chief Executive of the BPF, said: "This is a disastrous move that could have consequences far beyond the lifespan of this Government. Despite all the talk of open government, this ill-conceived move has been brought in without fair and proper consultation. There is a clear lack of joined up thinking between the Treasury and Communities departments, and ministers must understand the financial risks that private firms take to regenerate our towns and cities.
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