Local Government Finance Bill

January 16th, 2017 by James Goudie KC

This Bill, introduced in the House of Commons on 13 January 2017 (Bill 122), and which applies in England only, follows the Government’s announcement, in October 2015, that, by the end of the present Parliament, local government would retain 100% of locally raised taxes. The changed system is also designed to strengthen incentives for local authorities to grow their business rate income.

The Bill is made up of four parts:-

Part 1: Local Government Finance Settlement

Local retention of non-domestic rates – provides a framework to allow local government to retain 100% of non-domestic rates.

Local government finance settlement – replaces the yearly local government finance settlement with a multi-year settlement.

Council tax referendum principles – replaces the yearly council tax referendum principles with multi-year principles
Part 2: Non-domestic rating in England

Indexation rate for non-domestic rating multipliers – enables HM Treasury to specify the indexation rate for calculating the non-domestic rating multiplier.

Multiplier discounts – provides local authorities with the power to reduce the non-domestic rating multipliers in their areas.

Rural rate relief – ensures small businesses in rural areas access the same level of business rate reliefs as those in urban areas.

Telecommunications infrastructure relief – provides a new relief for telecommunications infrastructure for hereditaments on both the central list and local lists.

Public toilet relief – enables local authorities to grant discretionary relief for local authority public toilets.

Central rating: other reliefs – enables hereditaments on the central list to benefit from charitable and unoccupied hereditament reliefs.

Central rating lists administration – provides the Secretary of State with a power to direct the central valuation officer to alter the central list.

Electronic billing – provides the Secretary of State with a power to require billing authorities to offer electronic billing.

Rating notices – provides power to issue guidance about notices (bills) relating to non-domestic rates.

Provision of digital services by HMRC – allows HMRC to incur preparatory expenditure in connection with providing digital services in England.


Part 3: Infrastructure Supplements

Infrastructure supplements – enables the Greater London Authority and mayoral combined authorities to impose a levy to fund expenditure on projects that will promote economic development.


Part 4: Other business rate supplements

Business improvement districts – provides for property owner arrangements and the imposition of property owner levies.

Business rate supplements – adds mayoral combined authorities to the list of levying authorities able to impose business rate supplements.

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