The new Non-Domestic Rates (Scotland) Bill was introduced by Cabinet Secretary for Finance, Economy and Fair Work in the Scottish Government, Derek Mackay, on 25 March 2019 as the primary legislation to implement many of the recommendations of the Barclay Review, including changes to the administration and enforcement of non-domestic rates and the reform of various reliefs.
Specifically, the Bill made provisions for the following:
- A move to 3 yearly revaluations after the next revaluation on 1st April 2022;
- Various provisions for the New and Improved Properties Relief;
- Changes to Charity Rates Relief – mainstream independent schools will no longer be eligible to apply for mandatory charitable rates relief. However, specialist independent music schools and independent special schools will not be affected by this change;
- The introduction of a new civil penalty for failure to comply with assessor information notices;
- An enabling power for the Scottish Ministers to issue statutory guidance to local authorities regarding the granting of sports club relief; and
- A GAAR (general anti avoidance regulation) for artificial rates avoidance arrangements.
Previous proposals to restrict empty property relief on listed buildings to 2 years were not covered by the Bill. However, it was recently confirmed the threshold will be extended to 5 years. The proposal to extend the current 42-day rest period for empty property will also be progressed, and secondary legislation will be drafted in due course.
Lynsey Russell, Associate at Ryden, commented:
“It is encouraging to see such progress being made in the reform of Non-Domestic rates, although the secondary legislation required to take these issues on board further will be key to delivering a better and fairer system for ratepayers.”