Six-figure cost of empty business units in Worthing, Adur and Arun revealed

Empty business units in Adur, Arun and Worthing are costing taxpayers hundreds of thousands of pounds a year in lost rates, according to research.

Tuesday, 4th February 2020, 10:52 am
Premises ranging from town-centre shops to warehouses qualify for relief if they are empty

Owners of empty shops, offices and warehouses do not have to pay business rates for three months, giving landlords time to find a new occupant.

But BBC Local News Partnerships research found the relief is costing taxpayers more than £1billion a year across England and Wales, with financially pressured councils losing out on significant sums.

In Worthing, relief on empty units in 2019/20 is forecast to cost a total of £502,992.

The figure represents 1.26 per cent of the town’s potential business rates income – about average in comparison to the rest of England.

The figure would represent the town’s best in six years, with the percentage decreasing from a high of 2.75 per cent in 2014/15.

In Adur, the research estimated relief would cost £129,374 – 0.56 per cent of potential income – a figure ranked as below average in comparison to the rest of the country.

Arun was also rated as below average, with an estimated £297,995 of relief representing 0.62 per cent of potential rates income.

In Worthing 183 units were reported as being subject to relief – 5.51 per cent of the total number of units, with 65 empty in Adur (2.89 per cent) and 303 empty in Arun (6.23 per cent).

While retailers have lobbied for reduced business rates, councils have become increasingly dependent on the cash generated.

Dr Kevin Muldoon-Smith, an expert in property tax from Northumbria University, said: “Business rates, along with council tax, will be very critical to the stability of local authority finances going forward because of central government grants being reduced. Unfortunately, we have this perverse situation where local government needs tax to go up and the business community are lobbying very hard for it to go down.”

A HM Treasury spokesman said empty property relief struck a ‘balance’ between incentivising property owners and not penalising those who lose a tenant at short notice.

They said further details of an ongoing business rates review would be released in due course.