Non-Domestic Rating Act 2023

Commentary on provisions of Act

Section 1: Local rating: liability and mandatory reliefs for occupied hereditaments

46. Section 1 of the Act makes provision as to the liability and mandatory relief for occupied properties. Most of section 1 (which introduces a new Schedule 4ZA for the rules to determine chargeable amounts) re-enacts the provisions currently in section 43 and 44 of the 1988 Act. The changes in Schedule 4ZA to the existing provisions in section 43 and 44 are:
    1. The introduction of improvement relief. Part 2 and paragraph 3 of the new Schedule 4ZA provides the circumstances in which improvement relief will apply on the local rating list where:
       1. The day concerned is within one year of qualifying improvements having been completed (the meaning of qualifying improvements being given in regulations by the appropriate national authority (the Secretary of State in relation to England or the Welsh Ministers in relation to Wales)) and any other conditions prescribed by the appropriate national authority are met. Details of how the government intends to use these powers to set the parameters of the improvement relief in England were explained in the November 2021 technical consultation and in draft regulations published for consultation between June and August 2033 1 . The government intends that improvement relief is available on qualifying improvements for one year but under paragraph 3(3)(a) the appropriate national authority may extend that period, and
       2. The day concerned falls before 1 April 2029. The government intends that relief will be available on qualifying improvements which are completed before 1 April 2028 (and therefore works completed during 2027/28 may continue to receive one year of relief in part during the year 2028/29). The government has said improvement relief will be reviewed in 20282 and, therefore, a power has is included in paragraph 3(3)(b) for the appropriate national authority to adopt a later date than 1 April 2029.
    2. Where the conditions for improvement relief in paragraph 3 of Schedule 4ZA have been met then paragraph 10(2)(a) of Schedule 4ZA provides that the chargeable amount is found using the hereditament’s rateable value less the value G where G is prescribed or calculated in accordance with provisions prescribed by the appropriate national authority. Details of how the government intends to prescribe G were explained in the November 2021 technical consultation and the draft regulations published for consultation in June 2023. Deducting G from the rateable value for the period of the relief will ensure ratepayers do not pay business rates on the change attributable to the qualifying improvement works.
    3. The introduction of Heat Network Relief. Part 3 and paragraph 5 of the new Schedule 4ZA makes provision for cases where the chargeable amount is zero – i.e. full mandatory relief. Paragraph 6 provides full mandatory relief for heat networks. To be eligible for the relief the conditions of paragraph 6(1) must be met:
       1. The hereditament is wholly or mainly used as a heat network (the meaning being given in regulations made by the appropriate national authority) and any conditions prescribed by the appropriate national authority are met. Details on how the government intends to use these powers in relation to England were explained in the November 2021 technical consultation, and
       2. The day concerned falls before 1 April 2035. The government has said that the relief in England will apply up to 1 April 2035 but under paragraph 6(3) the appropriate national authority may extend that date by regulations.
    4. Providing for rural rate relief in England to be a full relief at paragraph 8. The government has ensured that those eligible for rural rate relief receive 100% relief since 1 April 20173 by funding local government to use their discretionary powers to top up the existing 50% mandatory relief. Paragraph 8 will put those arrangements on a mandatory basis.
    5. New provisions (in paragraph 10(9) & (10)) allowing the Treasury to prescribe whether an English hereditament’s chargeable amount should be calculated from the small business non-domestic rating multiplier or the national non-domestic rating multiplier. Currently only those hereditaments eligible for small business rate relief are eligible for the small business non-domestic rating multiplier.
    6. The removal of reliefs which are now obsolete. The mandatory rate relief for former agricultural buildings (sections 43(6F) to (6L) of the 1988 Act) which expired on 15 August 2006 and the telecoms relief (sections 43(4E) to (4H) of the 1988 Act) which expired on 1 April 2022.

Section 2: Local rating: liability and mandatory reliefs for unoccupied hereditaments

47. Section 2 of the Act makes provision as to the liability and mandatory relief for unoccupied properties. Most of section 2 (which introduces a new Schedule 4ZB for the rules to determine chargeable amounts) re-enacts the provisions currently in section 45, 45A and 46 of the 1988 Act. The changes in Schedule 4ZB to the existing provisions in section 45 are:
    1. New provisions (in paragraph 3(6) & (7)) allowing the Treasury to prescribe whether an English hereditament’s chargeable amount should be calculated from the small business non-domestic rating multiplier or the national non-domestic rating multiplier. Currently the small business non-domestic rating multiplier is unavailable to unoccupied hereditaments.
    2. The removal of telecoms relief (sections section 45(4C) to (4G) of the 1988 Act) which expired on 1 April 2022.

Section 3: Central rating: liability and mandatory reliefs

48. Section 3 of the Act makes provision as to the liability and mandatory relief for persons designated on the central rating list. Persons designated on the central rating list may, under their name and a description of their hereditaments, be assessed for a number of hereditaments under one rateable value as a whole. Most of section 3 (which introduces a new Schedule 5A for the rules to determine chargeable amounts) re-enacts the provisions currently in section 54 of the 1988 Act. The changes in Schedule 5A to the existing provisions in section 43 and 44 are set out below:
    1. The provision of improvement relief on the central rating list. Part 2 and paragraph 3 of the new Schedule 5A provides the circumstances in which improvement relief will apply in respect of a person on the central rating list where:
       1. The day concerned falls within one year of qualifying improvement works having been completed in relation to one or more of the hereditaments to which a central list entry relates (the meaning of qualifying improvements being given in regulations made by the appropriate national authority).
       2. Such a hereditament is not unoccupied (the government intends that improvement relief is not available for unoccupied hereditaments) and any other conditions prescribed by the appropriate national authority are met. Details of how the government intends to use these powers to set the parameters of the improvement relief in England were explained in the November 2021 technical consultation and in draft regulations published for consultation between June and August 2033. The government intends that improvement relief in England is available on qualifying improvements for one year but under paragraph 3(4)(b) the appropriate national authority may extend that period, and
       3. The day concerned falls before 1 April 2029. The government intends that improvement relief will be available on qualifying improvements which are completed before 1 April 2028 (and therefore works completed during 2027/28 may continue to receive one year of relief in part during the year 2028/29). The government has said improvement relief in England will be reviewed in 2028 and, therefore, a power is included in paragraph 3(4)(a) for the appropriate national authority to adopt a later date than 1 April 2029,
    2. Where the conditions for improvement relief in paragraph 3 of Schedule 5A have been met then paragraph 6(2)(a) of Schedule 5A provides that the chargeable amount is found using the rateable value against the person’s name less the value G where G is prescribed or calculated in accordance with provisions prescribed in regulations by the appropriate national authority. Details of how the government intends to use these powers to set the parameters of the improvement relief in England are explained in the November 2021 technical consultation and in draft regulations published for consultation between June and August 2033. Therefore, deducting G from the rateable value for the period of the relief will ensure ratepayers do not pay business rates on the change attributable to the qualifying improvement works.
    3. New provisions to introduce onto the central rating list charitable rate relief in England and Wales (through paragraph 2 of the new Schedule 5A) and unoccupied rate relief for hereditaments in England (through paragraph 4 of the new Schedule 5A). On local rating lists, hereditaments occupied by a charity and used wholly or mainly for charitable purposes receive 80% mandatory relief on the face of the 1988 Act, and unoccupied hereditaments on local rating lists may, in some circumstances through regulations, pay no business rates. No similar provisions exist on the central rating list. To remedy this, section 3 introduces into the 1988 Act provisions for chargeable amounts providing 80% mandatory relief for charities on the central rating list and powers in England through regulations to provide a zero chargeable amount for a prescribed class of unoccupied hereditaments on the English central rating list. 
    4. New provisions (in paragraph 6(8) & (9)) allow the Treasury to prescribe whether an English hereditament’s chargeable amount should be calculated from the small business non-domestic rating multiplier or the national non-domestic rating multiplier. Currently the small business non-domestic rating multiplier is unavailable to persons on the central rating list.
    5. The removal of telecoms relief (currently section 54ZA of the 1988 Act) which expired on 1 April 2022.

Section 4: Discretionary relief

49. Section 4 of the Act amends section 47 of the 1988 Act which contains provisions as to when and how billing authorities may award discretionary relief. Section 47(7) of the 1988 Act provides that a billing authority can make a decision to apply section 47 no more than six months after the end of the financial year. Section 4(2) introduces a new sub-section (6A) to section 47 removing that restriction in England from the financial year beginning 1 April 2023. Section 4(3) amends the restriction in section 47(7) so that it continues to apply to Wales.

Section 5: Frequency with which lists are compiled

50. Section 5 amends section 41(2A) and section 52(2A) of the 1988 Act to provide for English rating lists to be compiled every three years rather than every five. Section 5 makes consequential changes to the meaning of "relevant period" in section 57A of the 1988 Act reflecting the shortened three-year revaluation period after the 2023 rating list.

Section 6: Transitional relief

51. Section 6 amends section 57A of the 1988 Act to provide for:
    1. The deadline before when regulations must be made under section 57A to be moved from 1 January in a revaluation year to 1 February.
    2. Removal of the requirement that the Secretary of State must in making the regulations have regard to the object of securing that the transitional arrangements are self-financing. The amendment retains a requirement that the Secretary of State must have regard to the object of securing that the transitional arrangements do not generate additional revenue.

Section 7: Completion notices for buildings ceasing to be, then becoming, occupiable

52. Section 46A and Schedule 4A of the 1988 Act make provision for the service of a completion notice in respect of a new building that is to be added to the rating list. This is a means of determining the completion day in relation to that building. The provisions also apply to part of a building. Section 7 amends the definition of a ‘building’ in section 46A so that a completion notice may also be served by a billing authority in England in respect of a building which, although not new in itself, was temporarily unoccupiable for example, due to a refurbishment or alteration. This will allow it to be added or returned to a list, using the same completion notice process as for new buildings, closing a lacuna in the legislation. Section 7 also includes provision for where part of a building is added to an existing building, such as an extension or the creation of a new floor.

Section 8: Central list administration

53. Prior to this Act, section 53 of the 1988 Act allowed the Secretary of State to, by regulations, designate persons and descriptions of hereditaments which are shown to be on the English central rating list. The system was devised to accommodate the national utility networks. But after the introduction of the central rating list in 1990, changes in the utilities sectors meant minor administrative regulations were required merely to maintain the accuracy and integrity of the central rating list. The government expected the need for such changes to increase as more telecommunication networks are moved to the central list4.
54. Under the regulation making powers, the government believed that the administrative function of operating and maintaining the central list would require an increasingly heavy process and regulatory burden. To address this, Section 8 introduces new powers of direction allowing the Secretary of State to direct the valuation officer to show, add, alter or remove the names of persons and descriptions of hereditaments which should appear on the English central rating list. These powers of direction will be used in place of the existing regulatory powers.
55. New section 52A(7) requires the central valuation officer to comply with any direction given under this section. New section 52A(8) makes further provision relating to directions under this section. New section 52A(9) provides that a direction under this section has effect from the day specified in the direction.

Section 9: Credits to and debits from main non-domestic rating accounts

56. Schedule 7B to the 1988 Act makes provision for the local retention of non-domestic rates known as the Business Rates Retention Scheme (BRSS). Part 1 of Schedule 7B concerns the main non-domestic rating accounts and provides for the circumstances in which amounts may be credited or debited to the account. Previously, paragraph 2(3) allowed the Secretary of State to debit from the account amounts which had been used for the purpose of local government (grants to local government, for example) but this could not exceed the amounts specified in sub-paragraph (4). The provision in sub-paragraph (4) was flawed and did not allow the Secretary to debit from the account the full value of grants he had paid to local government.
57. To correct this the Act amends paragraph 2(3) and (4) of Schedule 7B to the 1988 Act to allow the Secretary of State to credit or debit from the main non-domestic rating account amounts which the government has received and then used for the purpose of local government (such as grants). The amendments ensure that the Secretary of State may not make debits such as would result in a deficit on the non-domestic rating account.

Section 10: Disclosure of valuation information to ratepayers

58. Section 10 gives effect to the government’s commitment to allow greater sharing of information on the valuation of non-domestic properties. The section amends the 1988 Act inserting new paragraph 7B into Schedule 9 to the 1988 Act, to enable valuation officers to supply information to ratepayers in relation to their hereditament or its rateable value. The permissive nature of sub-paragraphs (2) and (4) allows for the valuation officer to disclose the information where they consider it would be reasonable to do so and where disclosure would not contravene data protection legislation.
59. Sub-paragraph (1) sets out that a valuation officer may disclose the information where a ratepayer has made a request for information that relates to the hereditament and to which the VOA had regard in determining the rateable value of the hereditament. Sub-paragraph (3) makes clear that these requests should be made using the VOA’s online service (which will be brought online before this section is brought into force) or otherwise in another manner agreed with the VOA.

Section 11: Disclosure of valuation information to Northern Ireland rating officials

60. Section 11 provides a new legal gateway to enable valuation officers in the VOA in England and Wales to disclose information to Northern Ireland rating officials to support them to discharge their statutory valuation functions. Mechanisms already exist for the sharing of valuation information between rating officials in England, Scotland and Wales, so this provision therefore removes an anomalous barrier to data-sharing within the UK.
61. Subsections (1) and (2) in the new section 63D in the 1988 Act set out the limited circumstances in which information may be disclosed by the VOA to Northern Ireland rating officials:
    1. The information is held in connection with the valuation officer’s statutory functions.
    2. A Northern Ireland rating official reasonably believes it will assist them to perform their valuation functions.
    3. The valuation officer considers it reasonable to disclose the information.
62. Appropriate limits to the power are specified in subsections (4) and (5), including limits on the use and onward disclosure of information by NI rating officials for purposes other than their statutory functions. However, there are some exceptions to this set out in subsections (6) and (7).
63. Subsection (8) applies the criminal offence and penalty provisions contained in section 19 of the CRCA in respect of the unauthorised use or further disclosure of information received under this section. This is a common approach where new information disclosure gateways are created relating to information which is subject to the duty of confidentiality in section 18 of the CRCA. The offence applies where a person’s identity is specified in or can be deduced from the wrongful disclosure.
64. Subsection (9) ensures consistency with how information which identifies a person is treated under section 23 of the CRCA.

Section 12: Sharing of non-domestic rating information between billing authorities and HMRC

65. Section 12 supports the introduction of the digitalising business rates (DBR) provisions (see section 13 below) by providing for the two-way sharing of information between HMRC, which will administer the DBR system, and billing authorities.
66. Section 12(1) amends section 63A of the 1988 Act to provide an officer of HMRC with the power to disclose revenue and customs information to a billing authority for a qualifying purpose. Qualifying purposes are set out in subsection (4) of section 63A. Officers of HMRC may only disclose such information to a billing authority; new subsection (1A) does not give an officer the power to disclose information to any of the other qualifying persons listed in subsection (3). The restrictions on the onward disclosure of revenue and customs information set out at section 63B of the 1988 Act will apply to any disclosures made under the new subsection.
67. Section 12(1) is needed because it is HMRC, rather than the Valuation Office Agency, which will administer the DBR system, including the sharing of information with billing authorities. Section 63A(1) as currently drafted is therefore not wide enough, as it restricts disclosures only to those made by an officer of the Valuation Office Agency, rather than an officer of HMRC more widely.
68. Section 12(2) inserts new section 63E into the 1988 Act. This provides for the sharing of information by a billing authority with HMRC. Subsection (1) in the new section 63E gives a billing authority permission to disclose non-domestic rating information to HMRC for the purpose of assisting HMRC to carry out its functions, while subsection (2) gives a power to officers of HMRC to require a billing authority to disclose information for that purpose. Subsection (3) provides that disclosures made under new section 63E must be compliant with data protection legislation.

Section 13: Requirements for ratepayers etc to provide information

69. Section 13 provides for: a new duty on ratepayers in England and Wales to provide a taxpayer reference number to HMRC (as part of the digitalisation of business rates); and new duties on ratepayers in England to provide information to the VOA to support a shorter revaluation cycle and improve the accuracy of the list. The duties are each accompanied by a set of penalties to ensure compliance and a system for reviews and appeals. The section amends Schedule 9 (administration) to the 1988 Act.
70. Section 13(2) creates, in new paragraphs 4B to 4H of Schedule 9, a new duty on ratepayers in England and Wales to provide an up-to-date taxpayer reference number to HMRC:
    1. Paragraph 4B provides that the duty applies to persons who are ratepayers in respect of hereditaments in England and Wales. The term ‘ratepayer’ is defined in section 67 (interpretation: other provisions) and includes those who may be in receipt of relief of 100% and therefore have a chargeable amount of nil.
    2. Paragraph 4C sets out the scope of the duty on those persons. Where they have a taxpayer reference number (as defined in new paragraph 4F(1)), they must make a notification to HMRC if: they have not already done so; or they have already done so, but the number they provided was, or has since become, incorrect (for example, if they have since been issued with a new number).
    3. Paragraph 4D provides for persons to make the notification within 60 days either of becoming a ratepayer in respect of the hereditament, or of when they knew, or ought to have known, that the number they provided was, or became, incorrect.
    4. Paragraph 4E provides for the notification to be made using an online facility provided by HMRC, or in another agreed manner.
    5. Subparagraph 4F(1) defines taxpayer reference number to cover: unique taxpayer references (such as self-assessment, partnership, corporation tax), VAT registration numbers, and national insurance numbers. It also defines taxpayer reference notification as a notification made to HMRC by the ratepayer in respect of a hereditament, specifying their taxpayer reference number.
    6. Subparagraph 4F(2) gives the Commissioners for HMRC a power to amend, by regulations, the definition of taxpayer reference number given in subparagraph (1), for example to add another type of number to the definition. So far as these regulations apply to Wales, the Commissioners for HMRC must consult the Welsh Ministers before making them.
    7. Paragraph 4G gives the Commissioners for HMRC a power to provide, by regulations, that the duty to provide a taxpayer reference number, as set out in the preceding paragraphs, does not apply to a person or a group of persons. So far as these regulations apply to Wales, the Commissioners for HMRC must consult the Welsh Ministers before making them.
71. Section 13(3) creates, in new paragraphs 4I to 4M of Schedule 9, a set of duties on ratepayers to provide notifiable information to the VOA:
    1. Paragraph 4I provides that the duties apply, in respect of a hereditament in England, to persons who are or would be a ratepayer. The term ‘ratepayer’ will be defined in section 67 (interpretation: other provisions) and includes those who may be in receipt of relief of 100% and therefore have a chargeable amount of nil.
    2. Paragraph 4J provides for a duty for that person to provide notifiable information within a notifiable period. Information is notifiable if it relates to the identity of the ratepayer or the existence, extent or rateable value of the hereditament, and the ratepayer could reasonably be expected to know that it would assist the VOA in carrying out its functions. The notifiable period is within 60 days of the change in notifiable information or such longer period as may be specified by the VOA.
    3. Paragraph 4K provides for the person to make an annual confirmation in which they confirm within 60 days of the start of the financial year that they have either provided notifiable information or confirm that they were not required to provide such information. The government has said the duty for annual confirmation will not come into force until the government is satisfied it will be straightforward to use.
    4. Paragraph 4L provides for the information to be submitted using an online facility provided by the VOA or in another agreed manner.
    5. Paragraph 4M replicates the existing powers in paragraph 5 of Schedule 9 to the 1988 Act which allow the VOA to also request information which they believe will assist them in carrying out their functions. The VOA may still need to request information using this power; in particular for specialist properties and in respect of very specific types of information.
72. Section 13(4) creates, in new paragraphs 5ZA to 5ZF of Schedule 9 to the 1988 Act, a system of penalties for failures by ratepayers to comply with the new duties:
    1. Paragraphs 5ZA and 5ZB (covering the duty to provide a taxpayer reference number) provide for:
       1. A new civil penalty (5ZA(1)) where a person fails to comply with the requirement to make a taxpayer reference notification to HMRC. The maximum penalty for a failure to make a notification is set at £100.
       2. A new civil penalty (5ZA(2)) where a person carelessly or deliberately provides false information in purported compliance with the requirement to make a taxpayer reference notification to HMRC. 5ZA(3) defines carelessness as a failure to take reasonable care. The maximum penalty for the provision of false information deliberately or carelessly is set at £3,000. The maximum is set at this level so as to give flexibility to HMRC to charge higher amounts where the circumstances warrant it (for example, where the false information has been provided deliberately and in an attempt to conceal fraudulent activity) and a lower amount where, for example, the false information has been provided simply as a result of carelessness on the part of the ratepayer. HMRC intends to issue guidance on how it will operate the penalties regime.
       3. A person’s liability to further penalties of up to £60 per day where that person has been served with a penalty under either 5ZA(1) or 5ZA(2) and has still failed to provide an acceptable taxpayer reference number within a further 30 days (5ZA(6)). A person’s liability to daily penalties is ongoing until their failure is rectified, but the maximum liability a person may accrue in daily penalties is capped at £1,800 (5ZA(7)).
       4. The contents of penalty notices (5ZA(4)), which are to be served by HMRC on persons who are being issued with a penalty under subparagraphs (1) or (2).
       5. The possibility that a person might be liable to penalties under both subparagraph (1) and subparagraph (2) simultaneously (5ZA(5)), for example where a ratepayer has more than one hereditament and has failed to make a notification in respect of one hereditament and has provided false information in respect of another.
       6. A power for HMRC to mitigate or remit any maximum penalty to which a person falls liable or which is imposed on them (5ZB). This will allow HMRC to operate a penalties regime which is fair, proportionate and which gives due regard to individual circumstances. HMRC intends to issue further guidance on how it will operate the penalties regime, including what level of penalties (up to the maximums provided for) it intends to issue and in what circumstances. The government has made a commitment only to issue penalties for a failure to make a taxpayer reference notification as a last resort and where all other methods of encouraging compliance have failed. The government has further committed not to issue a penalty for a failure to make a taxpayer reference notification where a person has already been issued with a penalty for a failure to make a relevant notification to the VOA, where those requirements to notify arose simultaneously.
    2. Paragraphs 5ZC to 5ZF cover the duty to provide notifiable information to the VOA. Paragraph 5ZC provides for:
       1. A new civil penalty (at paragraph 5ZC(1)) where a person fails to comply with the duties introduced in section 13(3) by paragraphs 4H to 4L. The penalty is determined under paragraph 5ZD.
       2. A new criminal offence (at paragraph 5ZC(2)) where a person makes a false statement while purporting to comply with the duty. A person is liable on summary conviction to imprisonment for a term not exceeding 3 months or a fine not exceeding level 3 on the standard scale. For a criminal offence, as is normal, this must meet the test of beyond reasonable doubt. Alternatively, the person may be liable for a civil penalty for making a false statement of the same nature if this is beyond reasonable doubt (the civil penalty is determined under paragraph 5ZD). In practice the VOA expect to pursue the civil penalty in the first instance in this situation.
       3. The arrangements for serving and the contents of penalty notices where the person is liable for a civil penalty.
    3. Paragraph 5ZD provides for the level of civil penalty:
       1. Where the person has failed to comply with a notification requirement as a result of knowingly or recklessly making a false statement, the maximum penalty is the sum of 3% of their rateable value and £500.
       2. Where the person has failed to comply with a notification requirement for any other reason, the maximum penalty is the greater of 2% of their rateable value and £900, and a further penalty of £60 per day if the person fails to comply within 30 days of being serviced with an associated penalty notice. A person’s liability to daily penalties is ongoing until their failure is rectified, but the maximum liability a person may accrue in daily penalties is capped at £1,800 (5ZD(4)).
    4. Paragraph 5ZE provides for the determination of rateable values for the purposes of calculating penalties where a matter affecting the rateable value has changed between the day when the notifiable information should have been provided and the day of the penalty notice. These provisions ensure that the penalty calculated under paragraph 5ZD is not increased or reduced merely due to changes to the hereditament after the liability to the penalty first arose.
    5. Paragraph 5ZF provides for the valuation officer to mitigate or remit any of the above penalties. This will allow the VOA to operate the duties and penalties fairly and with due regard to individual circumstances. The VOA intends to produce a policy statement setting out how it will determine the level of penalty it will impose in particular cases. In exercising their discretion under paragraph 5ZF, the government has said that the VOA will draw upon the existing HMRC practice for mitigation of sanctions and HMRC’s approach to Reasonable Excuse5.
73. Section 13(6) creates, in new paragraphs 5BA to 5BF of Schedule 9 to the 1988 Act, a process for reviewing and appealing penalties:
    1. Paragraphs 5BA to 5BC cover reviews and appeals of penalties imposed by HMRC in relation to the duty to provide a taxpayer reference number:
       1. Paragraph 5BA gives a person 30 days to request a review of a penalty notice (5BA(2)). The review is conducted by a reviewing officer in HMRC different to the officer who applied the penalty (5BA(10)). The nature and extent of the review are such as appear appropriate to the reviewing officer (5BA(6)) – HMRC will follow its standard principles for conducting reviews, including consideration of ‘reasonable excuse’. The review must be completed within 45 days (5BA(8)), otherwise the review is treated as having confirmed the penalty (5BA(9)).
       2. Paragraph 5BB provides for a right of appeal against the conclusions of the review conducted under 5BA to the valuation tribunal within 30 days of the review conclusions (5BB(2)). For ratepayers in England, appeals are to be made to the Valuation Tribunal for England; for ratepayers in Wales, they are to be made to the Valuation Tribunal for Wales (5BB(4)).
       3. Paragraph 5BC provides that the incidence of a review or appeal does not prevent a further penalty being applied where the person continues to fail to comply with their duty.
    2. Paragraphs 5BD to 5BF cover reviews and appeals of penalties imposed by the VOA in relation to its information duty:
       1. Paragraph 5BD gives a person 30 days to request a review of a penalty notice. The review is done by a reviewing officer of the VOA different to the officer who applied the penalty. The nature and extent of the review are such as appear appropriate to the reviewing officer but the government has said the mitigating criteria will be based on HMRC’s approach to Reasonable Excuse. The review must be completed within 45 days (or otherwise the review is treated as having confirmed the penalty).
       2. Paragraph 5BE provides for a right of appeal against the conclusions of the review in 5BA to the valuation tribunal within 30 days of the notification of the review conclusions.
       3. Paragraph 5BF provides that the incidence of a review or appeal does not prevent a further penalty being applied where the person continues to fail to comply with the notification requirement.

Section 14: Alterations to lists: matters not to be taken into account in valuation

74. Section 14 of the Act makes provision to ensure that matters concerning legislation and advice or guidance given by a public authority should not be taken into account when determining rateable values in England between revaluations.
75. Rateable values are determined in line with rules in Schedule 6 to the 1988 Act. Broadly speaking the rateable value is the annual rental value of the hereditament. Schedule 6 to the 1988 Act provides for the rateable value, during the lifetime of a rating list, to be assessed by reference to two dates:
    1. Paragraph 2(3)(b) of Schedule 6 to the 1988 Act gives the Secretary of State the power to specify a day – known as the valuation date – by reference to which the assessment of rateable value in a rating list is to be made. For the 2023 rating list, that day was specified as 1 April 20216. Therefore, rateable values in the 2023 rating list will be made by reference to valuations as at 1 April 2021.
    2. Paragraph 2(6A) of Schedule 6 to the 1988 Act gives the Secretary of State powers to specify rules for determining the day – known as the material day - by reference to which certain matters are to be reflected. Those matters are listed in paragraph 2(7) of Schedule 6 to the 1988 Act and include matters such as those affecting the physical state of the hereditament or mode or category of occupation of the hereditament.
76. Therefore, for example, rateable values in the 2023 rating list are to be made by reference to factors affecting valuations as at 1 April 2021 except for those matters listed in paragraph 2(7) of Schedule 6 which are reflected as at the material day. As a result, where one of the matters listed in paragraph 2(7) of Schedule 6 changes during the life of a rating list then the rateable value of existing hereditaments may need to be amended and that matter may need to be reflected in the rateable value of new hereditaments. A change in any matter not within the list in paragraph 2(7) of Schedule 6 should not lead to a change in an existing rateable value or be reflected in the rateable value of new hereditaments, before the next rating list is compiled.
77. Section 14 provides that when an English list is being compiled by reference to a day specified under paragraph 2(3)(b) of Schedule 6 to the 1988 Act or subsequently altered, then determinations of rateable values should not take account of a subsequent change in a matter directly or indirectly attributable to the matters listed in the new paragraph 2ZA(2) of Schedule 6 inserted by section 14. Those matters are: legislation (such as the legislative aspects of the government’s Non-Pharmaceutical Interventions7 in relation to coronavirus); provisions made under or given effect by legislation (such as a statutory license regime); advice or guidance given by a public authority (such as guidance from the Health and Safety Executive in relation to social distancing); and anything done by a person with a view to compliance with these matters; but only so far as they concern:
    1. The physical enjoyment of the hereditament (and not matters affecting the physical state of the hereditament).
    2. Matters which, though not affecting the physical state of the locality are, nonetheless, physically manifest there.
    3. The use or occupation of other premises in the locality.
78. Therefore, the new provisions do not apply to matters affecting the physical state of the hereditament or the physical state of the locality. They also, under the new paragraph 2ZA(4) of Schedule 6 do not apply to matters concerning whether a hereditament is domestic or non-domestic or exempt. The new provisions will apply for a list compiled on or after 1 April 2023 but can still (under subsection (3) of Section 13) have effect in relation to a change in a matter prior to that date.

Section 15: Multipliers

79. Section 15(2) makes provision for the multipliers in England. Most of section 15(2) (which inserts a new Part A1 of Schedule 7 to the 1988 Act) re-enacts the provisions currently in Part 1 of Schedule 7. The changes to the existing provisions in Schedule 7 are:
    1. Chapters 2, 3 and 5 of the new Part A1 provide for both the non-domestic rating multiplier and the small business non-domestic rating multiplier to be indexed each year in line with the change in Consumer Prices Index at the September preceding the year in question rather than the Retail Prices Index. It also provides that the Treasury may, by regulations, index either multiplier by a figure less than the Consumer Prices Index. The existing requirement in paragraphs 3A and 4A of Part 1 that the non-domestic rating multiplier is found by making an addition to the small business non-domestic rating multiplier of an amount to meet the cost of the providing Small Business Rate Relief is omitted from the new Part A1.
    2. The requirement in paragraph 6(4) of Schedule 7 that the multipliers cannot be confirmed until the relevant local government finance report has been approved by the House of Commons in relation to England has been removed for Part A1.
    3. An anomaly in paragraph 4 of Schedule 7 which currently provides for the multiplier to be rounded down when it is calculated to between 5 and 6 ten thousandths (whereas the normal rules of rounding would result in that situation in rounding up) is corrected in Part A1 paragraph A9.
80. Section 15(3)(a) and (c)(ii) correct similar anomalies in the existing provisions in relation to the indexation and rounding of the multiplier in Wales. To allow Wales to independently commence these changes, section 15(3)(b) and (c)(i) separate out the existing provision in paragraph 5(11) of Schedule 7. Section 15(4) removes the requirement that a multiplier in Wales cannot be confirmed until the relevant local government finance report(s) has been approved by the Senedd.

Section 16: Interpretation

81. Section 16 makes provision for interpretation of the meaning of "the Act".

Section 17: Consequential provisions

82. Section 17 introduces the Schedule which makes changes consequential on sections 1 to 3, 5, 6, 8, 12, 13, and 15 of the Act. Section 17 also gives the appropriate national authority power to make regulations to make such provision as it considers appropriate in consequence of the Act.