Revaluation Welcome But Change Needed To Secure Fair Rates for Hospitality Industry
21 November 2017
Commenting on the announcement of the planned rates revaluation by the Land and Property Services, Colin Neill, CEO of Hospitality Ulster said:
“We welcome the announcement that the next business rates revaluation will take place within the five year period since the last revaluation.
“Hospitality Ulster has campaigned for regular revaluation of the business rates to avoid the issues that occurred the last time when some hospitality businesses saw their rates more than treble overnight.
“This enormous increase occurred because business rates in Northern Ireland had not been revalued for over ten years. With rates on pubs and hotels calculated on their turnover it is even more important that revaluations take place regularly to reflect market trends and also to allow businesses to plan for any increases.”
Whilst welcoming the revaluation, Colin Neill also said there are issues with the model:
“We still have issues with the turnover model used to calculate rates on pubs and hotels, with rising overheads driving down profit margins and pushing up turnover. It is time that actual profitability was taken into account as high turnover does not equate a high profit, nor indeed any profit.”
Colin Neill also raised the issue of rates on food-led pubs and said the policy was delaying diversification of the pub sector:
“With many of our pubs now focusing on food, there is also an issue on how food sales are taken into the rates equation. Currently a pub selling less alcohol and more food than a comparable restaurant can be paying twice the rates. This is not only unfair but is actually holding back the diversification of pub industry and impacting the tourism offer.
Hospitality Ulster will be engaging with LPS over the coming months in an effort to secure a fairer rating system for the hospitality industry.”