Havering Council took more than 1,000 firms to court for not paying business rates, figures reveal
PUBLISHED: 07:00 26 July 2018 | UPDATED: 07:29 26 July 2018
The council took more than 1,000 of the borough's firms to court for failing to pay business rates, figures have revealed.
An investigation by real estate advisor Altus Group showed that Havering Council in the last financial year hauled 1,296 firms before magistrates to recover the tax on businesses.
National government works out business rates based on a property’s ‘rateable value’ meaning its rental value on the open market. They are updated every five years.
In total there were 4,365 properties in the borough liable to pay the charge, according to Altus Group, with 30 per cent taken to court.
Robert Hayton from Altus Group said the findings went way beyond simple tax avoidance.
“Annual inflationary rises for the seven years before the revaluation period pushed the tax rate from 41.4p in 2010-2011 to 49.7p in 2016-2017 meaning a rise of 20 per cent in bills even before the revaluation came into effect creating financial pressures,” Mr Hayton said.
The figures – gained through a freedom of information request sent to all London councils and replied to by 25 – compares to first place Tower Hamlets (2,876), second place Hackney (2,282) and Sutton with the lowest at 403.
The numbers led Altus Group to claim new business rates – re-evaluated last year – were criminalising firms struggling to cope with an ever increasing tax burden.
Cllr Roger Ramsey, the council’s finance chief, said: “The Council relies on prompt payment of council tax and business rates so we can provide the vital services our residents need.”
He added that summonses to appear before magistrates were only issued to ratepayers who had failed to keep up with payments, despite previously receiving notices.
“Many of those ratepayers receiving a summons for non or late payment of business rates would have contacted the council to enter into a mutually acceptable re-payment plan.
“Businesses are sent warning letters in advance of any legal action being taken, and any ratepayers that are having difficulties paying are encouraged to contact the council immediately so we can discuss their individual situation,” Cllr Ramsey said.