The Non-Domestic Rating (Small Business Relief) (Wales) Order 2008

Explanatory Note

(This note is not part of the Order)

This Order comes into force on 1 December 2008 but has effect from 1 April 2008 and it applies to Wales.

This Order re-enacts the Non-Domestic Rating (Small Business Relief) (Wales) Order 2006 (“the 2006 Order”) with amendments. The 2006 Order provided for a small business rate relief scheme for Wales following the coming into force of section 63 of the Local Government Act 2003. That section made amendments to sections 42A, 43 and 47 of the Local Government Finance Act 1988 (“the 1988 Act”).

In addition to drafting amendments this Order makes the following changes of substance—

• an increase to the upper rateable value threshold for receipt of the general relief;

• provision of specific relief for retail premises (as defined in article 2), child care providers and credit unions;

• provision for ratepayers claiming relief to give notice to the billing authority but this does not apply to those ratepayers who claim relief on the basis of their rateable value only. This provision also applies in respect of post offices which were eligible under the 2006 Order.

Article 2 of the Order defines hereditaments which are excepted from the small business rate relief scheme but this provision does not apply to relief given in respect of post offices.

Article 3 prescribes a maximum rateable value of £12,000 for hereditaments which might be eligible for relief.

Articles 5 to 9 prescribe conditions of eligibility.

Article 10 provides for the information to be included in the notice to be given to billing authorities, the times within which such a notice is to be served and methods of service.

Article 11 prescribes the amount of E for the purposes of the formula contained in section 43(4A)(b) of the 1988 Act. That formula provides the mechanism for calculating the amount of rates payable in respect of particular hereditaments.

Articles 5 and 11 have the effect of granting, subject as indicated in those articles, (a) 50% rate relief to hereditaments which have a rateable value of £2,000 or less; and (b) 25% rate relief to hereditaments which have a rateable value of more than £2,000 but not more than £6,500 (but the latter figure will be £5,000 as from 1 April 2012).

Articles 6 and 11 have the effect of granting, subject as indicated in those articles, 100% rate relief to post offices which have a rateable value of £9,000 or less, and 50% rate relief to post offices which have a rateable value of more than £9,000 but not more than £12,000.

Articles 7 and 11 have the effect of granting, subject as indicated in those articles, 25% rate relief to retail premises which have a rateable value of more than £6,500 but not more than £9,000. This relief will cease on 31 March 2012.

Articles 8 and 11 have the effect of granting, subject as indicated in those articles, 50% rate relief to premises used for child care provision which have a rateable value of more than £2,000 but not more than £12,000. This relief will cease on 31 March 2012.

Articles 9 and 11 have the effect of granting, subject as indicated in those articles, 50% rate relief to premises used for credit unions which have a rateable value of more than £2,000 but not more than £9,000. This relief will cease on 31 March 2012.

The rural rate relief scheme for Wales lapsed but was saved by the 2006 Order in relation to financial years ending on or before 31 March 2007 and that saving is continued by this Order. The 2006 Order is revoked but will remain in force in relation to the financial year ending on 31 March 2008.

A regulatory impact assessment has been prepared in connection with these Regulations. A copy can be obtained at http://www.assemblywales.org/bus-home/bus-guide-docs-pub/bus-business-documents/bus-business-documents-doc-laid.htm.