Business to vote on rates increase

In a green paper on local government finance the Department of the Environment proposes that councils be able to levy up to 1% extra per year on businesses.

But government envisages the creation of formal ‘partnership arrangements’ between business and local authorities to approve the increases.

However, the British Chambers of Commerce has called the supplement ‘another tax on business’.

Chris Humphries, Director General of the BCC, said: ‘The provision for business consultation is inadequate with the danger that yet again business picks up the bill for poorly controlled spending. Not only are these proposals likely to undermine the good working relationships that have developed between local authorities and their business communities, but they could also threaten local economic competitiveness.’

The BCC fears councils will be able to levy the supplement and only then seek agreement on how it should be spent.

However, there is to be three months consultation on the proposals and actual legislation is not expected until after the next general election.

Further proposals in the green paper are aimed at allowing councils to make more decisions themselves about what they can afford to borrow.

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