Westminster City Council has refused to grant empty business rates relief to office-based businesses for the three months such offices were empty during lockdown- even though the Government prohibited businesses from using them.
Westminster City Council has sent letters out to rate payers saying that despite COVID-19:
“Normal legislation and case rules apply to whether a property is in rateable occupation or whether the property is empty
“For properties that are confirmed as truly empty, the “prohibited by law” empty rate exemption does NOT apply to either retail or non-retail properties”
This decision not to offer empty business rates relief is despite the Government announcing on 23 March that staff in office-based businesses should not assemble together, nor to travel on public transport unless they were essential workers, but should work from home - effectively prohibiting the use of such offices and leading to many business owners leaving their offices and work locations empty.
And as the lockdown has started to lift, many offices are still empty or only just becoming partly occupied, particularly as Government has insisted on social distancing rules, limiting numbers and discouraging workers from using public transport.
John Webber, Head of Business Rates at Colliers International is disappointed at Westminster City Council’s attitude. He said, “We believe a three months business rates holiday would have been the most sensible decision for the Government to take regarding office occupiers, particularly, if they were prohibiting them from using their offices.
When you see that businesses in the retail and leisure/hospitality sector have been given a one-year rates holiday and are supported by various grants to help them cope through the COVID-19 pandemic, we really question the double standard shown to office-based businesses.
Many of our clients in the office sector have been badly impacted by COVID-19 but have received little or no assistance. Such businesses across all sectors are vital if the economy is to rejuvenate. At a time when revenues have been hit and costs have risen, particularly as many businesses now need to adapt to new rules and regulations as we go back to work, it is short sighted to knock them back for six.
We urge the Government to instruct Local Authorities to show flexibility and support to business as they begin running properly again and to grant empty rates relief for this period.”
He continued, “Several of our clients are now taking Counsel opinion on the matter and we would not be surprised to see an increase in legal action in the months ahead.”
According to Colliers’ estimates, office-based properties in the borough of Westminster have a current rateable value of around £1.56 billion. The rates bill for the three-month period of lockdown equates to £195 million.